10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_________

FORM 10-Q

_________

ýQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 30, 2013

OR

oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from_____ to _____

Commission file number 0-362

FRANKLIN ELECTRIC CO., INC.

(Exact name of registrant as specified in its charter)

Indiana	35-0827455
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
400 East Spring Street
Bluffton, Indiana	46714
(Address of principal executive offices)	(Zip Code)

(260) 824-2900

(Registrant's telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YESx NOo

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

YESx NOo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filerx Accelerated Filero Non-Accelerated Filero Smaller Reporting Companyo

1

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

YESo NOx

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

	Outstanding at
Class of Common Stock	April 30, 2013
$.10 par value	47,416,920 shares

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FRANKLIN ELECTRIC CO., INC.

TABLE OF CONTENTS

		Page
PART I.	FINANCIAL INFORMATION	Number
Item 1.	Financial Statements	X
	Condensed Consolidated Statements of Income for the First Quarters Ended March 30, 2013 and March 31, 2012	X
	Condensed Consolidated Statements of Comprehensive Income for the First Quarters Ended March 30, 2013 and March 31, 2012	X
	Condensed Consolidated Balance Sheets as of March 30, 2013 and December 29, 2012	X
	Condensed Consolidated Statements of Cash Flows for the First Quarters Ended March 30, 2013 and March 31, 2012	X
	Notes to Condensed Consolidated Financial Statements	X
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	X
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	X
Item 4.	Controls and Procedures	X
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	X
Item 1A.	Risk Factors	X
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	X
Item 4.	Mine Safety Disclosures	X
Item 6.	Exhibits	X
Signatures		X
Exhibit Index		X
Exhibits

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PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except per share amounts)	First Quarter Ended
	March 30, 2013			March 31, 2012
Net sales	$	222,524		$	201,924
Cost of sales	148,583			135,652
Gross profit	73,941			66,272
Selling, general, and administrative expenses	50,065			45,347
Restructuring (income)/expense	710			(73		)
Operating income	23,166			20,998
Interest expense	(2,590		)	(2,588		)
Other income	447			13,534
Foreign exchange income/(expense)	(171		)	(298		)
Income before income taxes	20,852			31,646
Income taxes	5,237			8,485
Net income	$	15,615		$	23,161
Less: Net income attributable to noncontrolling interests	(159		)	(115		)
Net income attributable to Franklin Electric Co., Inc.	$	15,456		$	23,046
Income per share:
Basic	$	0.32		$	0.49
Diluted	$	0.32		$	0.48
Dividends per common share	$	0.07		$	0.07

Shares and per share data have been adjusted for all periods presented to reflect a two-for-one stock split effective March 18, 2013.

See Notes to Condensed Consolidated Financial Statements.

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FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)	First Quarter Ended
	March 30, 2013			March 31, 2012
Net income	$	15,615		$	23,161
Other comprehensive income/(loss), before tax:
Foreign currency translation adjustments	(5,789		)	11,214
Employee benefit plan activity	970			587
Other comprehensive income/(loss)	$	(4,819	)	$	11,801
Income tax related to items of other comprehensive income	(380		)	(230		)
Other comprehensive income/(loss), net of tax	$	(5,199	)	$	11,571
Comprehensive income	$	10,416		$	34,732
Comprehensive loss attributable to noncontrolling interest	279			163
Comprehensive income attributable to Franklin Electric Co., Inc	$	10,695		$	34,895

Shares and per share data have been adjusted for all periods presented to reflect a two-for-one stock split effective March 18, 2013.

See Notes to Condensed Consolidated Financial Statements.

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FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)	March 30, 2013			December 29, 2012
ASSETS
Current assets:
Cash and cash equivalents	$	74,666		$	103,338
Receivables, less allowances of $3,269 and $3,148, respectively	130,884			102,918
Inventories:
Raw material	77,695			72,536
Work-in-process	18,223			18,295
Finished goods	109,440			101,017
	205,358			191,848
Deferred income taxes	11,386			7,912
Other current assets	21,886			22,901
Total current assets	444,180			428,917
Property, plant and equipment, at cost:
Land and buildings	90,276			90,616
Machinery and equipment	206,176			204,408
Furniture and fixtures	26,740			26,887
Other	43,699			33,500
	366,891			355,411
Less: Allowance for depreciation	(185,898		)	(183,436		)
	180,993			171,975
Deferred income tax	2,658			2,540
Intangible assets, net	155,393			158,117
Goodwill	206,861			208,141
Other assets	6,372			6,689
Total assets	$	996,457		$	976,379

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	March 30, 2013			December 29, 2012
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	63,978		$	68,660
Deferred tax liability	1,173			1,173
Accrued expenses	47,987			60,415
Income taxes	713			215
Current maturities of long-term debt and short-term borrowings	15,945			15,176
Total current liabilities	129,796			145,639
Long-term debt	174,854			150,729
Deferred income taxes	41,329			40,136
Employee benefit plans	76,144			78,967
Other long-term liabilities	39,331			38,659
Commitments and contingencies (see Note 16)	—			—
Redeemable noncontrolling interest	4,578			5,263
Shareowners' equity:
Common stock (65,000 shares authorized, $.10 par value) outstanding (47,412 and 47,132, respectively)	4,741			4,712
Additional capital	179,124			170,890
Retained earnings	405,481			395,950
Accumulated other comprehensive loss	(61,907		)	(57,146		)
Total shareowners' equity	527,439			514,406
Noncontrolling interest	2,986			2,580
Total equity	530,425			516,986
Total liabilities and equity	$	996,457		$	976,379

Shares and per share data have been adjusted for all periods presented to reflect a two-for-one stock split effective March 18, 2013.

See Notes to Condensed Consolidated Financial Statements.

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FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)	First Quarter Ended
	March 30, 2013			March 31, 2012
Cash flows from operating activities:
Net income	$	15,615		$	23,161
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	7,367			6,158
Share-based compensation	2,158			982
Deferred income taxes	(2,623		)	5,592
(Gain)/loss on disposals of plant and equipment	(1		)	(322		)
Gain on equity investment	—			(12,212		)
Asset impairment	—			200
Foreign exchange expense	171			298
Excess tax from share-based payment arrangements	(2,063		)	(731		)
Changes in assets and liabilities, net of acquisitions:
Receivables	(28,686		)	(25,395		)
Inventory	(17,038		)	(18,199		)
Accounts payable and accrued expenses	(8,441		)	(1,637		)
Income taxes	2,459			(3,344		)
Employee benefit plans	(1,485		)	(693		)
Other	1,788			(2,841		)
Net cash flows from operating activities	(30,779		)	(28,983		)
Cash flows from investing activities:
Additions to property, plant, and equipment	(16,515		)	(4,170		)
Proceeds from sale of property, plant, and equipment	55			1,204
Additions to intangibles	48			—
Cash paid for acquisitions, net of cash acquired	—			(27,862		)
Net cash flows from investing activities	(16,412		)	(30,828		)
Cash flows from financing activities:
Proceeds from issuance of debt	25,101			3,759
Repayment of debt	(85		)	(1,739		)
Proceeds from issuance of common stock	4,128			2,613
Excess tax from share-based payment arrangements	2,063			731
Purchases of common stock	(2,504		)	(30		)
Dividends paid	(3,417		)	(3,152		)
Payment of contingent consideration liability	(5,555		)	—
Net cash flows from financing activities	19,731			2,182
Effect of exchange rate changes on cash	(1,212		)	3,228
Net change in cash and equivalents	(28,672		)	(54,401		)
Cash and equivalents at beginning of period	103,338			153,337
Cash and equivalents at end of period	$	74,666		$	98,936

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Cash paid for income taxes	$	4,430	$	6,245
Cash paid for interest, net of capitalized interest of $235 and $20, respectively	$	2,379	$	2,330
Non-cash items:
Payable to seller of Pioneer Pump Holdings Inc.	$	—	$	1,698
Pioneer Pump Holdings, Inc. liability for mandatory share purchase	$	—	$	22,924
Payable to seller of Impo Motor Pompa Sanayi ve Ticaret A.S.	$	—	$	420
Additions to property, plant, and equipment, not yet paid	$	1,297	$	4

Shares and per share data have been adjusted for all periods presented to reflect a two-for-one stock split effective March 18, 2013.

See Notes to Condensed Consolidated Financial Statements.

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FRANKLIN ELECTRIC CO., INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accompanying condensed consolidated balance sheet as of December 29, 2012, which has been derived from audited financial statements, and the unaudited interim condensed consolidated financial statements as of March 30, 2013, and for the first quarters ended March 30, 2013 and March 31, 2012, have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations.  In the opinion of management, all accounting entries and adjustments (including normal, recurring adjustments) considered necessary for a fair presentation of the financial position and the results of operations for the interim period have been made. Operating results for the first quarter ended March 30, 2013, are not necessarily indicative of the results that may be expected for the fiscal year ending December 28, 2013. For further information, including a description of the Company’s critical accounting policies, refer to the consolidated financial statements and notes thereto included in Franklin Electric Co., Inc.'s Annual Report on Form 10-K for the year ended December 29, 2012.

2. ACCOUNTING PRONOUNCEMENTS

In March 2013, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2013-02 Comprehensive Income. This guidance requires companies to disclose additional information about items reclassified out of accumulated other comprehensive income ("AOCI") either on the face of the income statement or as a separate footnote to the financial statements. In addition, changes in AOCI balance by component are to be presented. ASU 2013-02 is effective for both annual and interim periods for fiscal years beginning after December 15, 2012. The Company adopted ASU 2013-02 on a prospective basis, effective December 30, 2012. Refer to Note 14 for disclosures made. As the ASU addressed only disclosure requirements, adoption of ASU 2013-02 did not have a material impact on the Company's financial position, results of operations, or cash flows.

3. STOCK SPLIT

On February 22, 2013, the Company announced that its Board of Directors declared a two-for-one stock split of the Company's common stock in the form of a 100 percent stock distribution. The stock distribution was distributed or paid on March 18, 2013, to stockholders of record as of March 4, 2013. As a result of this action, approximately 23.7 million shares were issued to stockholders of record as of March 4, 2013. The par value of the common stock remains at $0.10 per share and, accordingly, approximately $2.37 million was transferred from retained earnings to common stock. Earnings and dividends declared per share and weighted average shares outstanding are presented in this Form 10-Q after the effect of the 100 percent stock distribution. The two-for-one stock split is reflected in the share and per share amounts in all periods presented in this Form 10-Q.

4. ACQUISITIONS

The fair values of the identifiable intangible assets and property, plant, and equipment for the 2012 Pioneer Pump Holdings, Inc. ("PPH") acquisition were final as of the first quarter ended March 30, 2013. The Company utilized management estimates and consultation with an independent third-party valuation firm to assist in the valuation. No adjustments were required as a result of the final valuation to the preliminary amounts previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012.

Transaction costs were expensed as incurred under the guidance of FASB ASC Topic 805, Business Combinations.

There were no transaction costs included in selling, general, and administrative expense in the Company’s condensed consolidated statement of income for the first quarter ended March 30, 2013.

5. REDEEMABLE NONCONTROLLING INTERESTS

On May 2, 2011, the Company completed the acquisition of 80 percent of Impo Motor Pompa Sanayi ve Ticaret A.S. ("Impo"). The 20 percent noncontrolling interest was recorded at fair value as of the acquisition date. The noncontrolling interest holders have the option, which is embedded in the noncontrolling interest, to require the Company to redeem their ownership interests after May 2, 2014, three years after the original agreement was signed. The combination of a noncontrolling interest and a redemption feature resulted in a redeemable noncontrolling interest.

The noncontrolling interest in Impo is redeemable at other than fair value as the redemption value is determined based on a specified formula.  The noncontrolling interest becomes redeemable after the passage of time and, therefore, the Company records the carrying amount of the noncontrolling interest at the greater of (1) the initial carrying amount, increased or

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decreased for each noncontrolling interest's share of net income or loss and its share of other comprehensive income or loss and dividends (“carrying amount”) or (2) the redemption value which is determined based on the greater of the redemption floor value or the then-current specified earnings multiple.  As of March 30, 2013, the Impo redeemable noncontrolling interest was recorded at the carrying amount.

According to FASB ASC Topic 810, Consolidation and Emerging Issues Task Force ("EITF") Topic No. D-98, Classification and Measurement of Redeemable Securities, for redeemable noncontrolling interests issued in the form of common securities, to the extent that the noncontrolling interest holder has a contractual right to receive an amount upon share redemption that is other than the fair value of such shares, the noncontrolling interest holder has, in substance, received a dividend distribution that is different from other common shareholders. Therefore, adjustments to the noncontrolling interest to reflect the redemption amount should be reflected in the computation of earnings per share using the two-class method. Under the two-class method, the Company has elected to treat as a dividend only the portion of the periodic redemption value adjustment (if any) that reflects a redemption value in excess of fair value.  No adjustments were necessary for the first quarters ended March 30, 2013 or March 31, 2012.

6. FAIR VALUE MEASUREMENTS

FASB ASC Topic 820, Fair Value Measurements and Disclosures, provides guidance for defining, measuring, and disclosing fair value within an established framework and hierarchy. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The standard established a fair value hierarchy which requires an entity to maximize the use of observable inputs and to minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value within the hierarchy are as follows:

Level 1 – Quoted prices for identical assets and liabilities in active markets;

Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and

Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

As of March 30, 2013, and December 29, 2012, the assets and liabilities measured at fair value on a recurring basis were as set forth in the table below. The "Recognized Loss" amounts in the table are accumulated totals since inception.

(In millions)	March 30, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Recognized Loss
Cash equivalents	$	12.8	$	12.8	$	—	$	—	$	—
Impo contingent consideration	—		—		—		—		—
	December 29, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Recognized Loss
Cash equivalents	$	13.8	$	13.8	$	—	$	—	$	—
Impo contingent consideration	5.6		—		—		5.6		0.8

The Company's Level 1 assets consist of cash equivalents which are generally comprised of domestic money market funds invested in high quality, short-term liquid assets, and foreign bank guaranteed certificates of deposit.

The Company has no assets or liabilities classified as Level 2.

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During the second quarter of 2011, the Company recorded $5.5 million (TL 8.5 million) of contingent consideration related to the second quarter 2011 acquisition of Impo. The fair value of this Level 3 liability was $5.6 million (TL 10.0 million) as of December 29, 2012, based on Impo achieving specified financial targets. The contingent consideration of $5.6 million (TL 10.0 million) was paid out during the first quarter of 2013.

7. OTHER ASSETS

In 2005, the Company acquired a 35.0 percent equity interest in Pioneer Pump, Inc. ("PPI"), which was accounted for using the equity method. During the first quarter of 2012, the shareholders of PPI and Pioneer Pump, Ltd. ("PPL") contributed shares to form a new holding company, PPH, in exchange for equivalent value and control in PPH. As a result of this contribution, the Company's equity interest decreased to 31.0 percent of PPH. On March 7, 2012, the Company acquired a controlling interest in PPH, resulting in the consolidation of PPH in the Company's financial statements. Accordingly, the original equity interest in PPH was remeasured to its fair value of $23.9 million as of March 7, 2012. The carrying amount of the equity investment prior to the acquisition of the controlling interest was $11.7 million as of March 6, 2012.  As a result, the Company recognized a one-time gain of $12.2 million in the "Other income" line of the Company's condensed consolidated statement of income for the first quarter ended March 31, 2012. Prior to the acquisition, the Company’s proportionate share of Pioneer Pump, Inc. earnings, included in the “Other income” line of the Company’s condensed consolidated statements of income, was $0.4 million for the first quarter ended March 31, 2012. The additional purchase was made in 2012, bringing total ownership to 70.5 percent.

During the second quarter of 2011, the Company entered into a loan agreement with the parent of a customer.  The current maturity is included in "Receivables" and the long-term portion is included in "Other assets" on the Company's consolidated balance sheet. The agreement provides for interest on the loan at a variable market interest rate with the customer to repay the loan plus interest in semi-annual installments throughout the 7-year term.  The Company has a long-term relationship with the customer and considers the loan fully collectible.

8. INTANGIBLE ASSETS AND GOODWILL

The carrying amounts of the Company’s intangible assets are as follows:

(In millions)	March 30, 2013					December 29, 2012
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangibles:
Patents	$	7.8	$	(5.7	)	$	7.8	$	(5.7	)
Supply agreements	4.4		(4.4		)	4.4		(4.4		)
Technology	7.5		(3.4		)	7.5		(3.2		)
Customer relationships	125.3		(24.8		)	125.9		(23.1		)
Software	1.7		(0.1		)	1.7		(0.1		)
Other	1.2		(1.2		)	1.2		(1.2		)
Total	$	147.9	$	(39.6	)	$	148.5	$	(37.7	)
Unamortized intangibles:
Trade names	47.1		—			47.3		—
Total intangibles	$	195.0	$	(39.6	)	$	195.8	$	(37.7	)

Amortization expense related to intangible assets for the first quarters ended March 30, 2013 and March 31, 2012, was $2.0 million and $1.5 million, respectively.

Amortization expense for each of the five succeeding years is projected as follows:

(In millions)	2013		2014		2015		2016		2017
	$	8.4	$	8.4	$	8.4	$	8.3	$	8.0

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The change in the carrying amount of goodwill by reporting segment for the first quarter ended March 30, 2013, is as follows:

(In millions)	Water Systems			Fueling Systems			Consolidated
Balance as of December 29, 2012	$	144.9		$	63.2		$	208.1
Acquisitions	—			—			—
Adjustments to prior year acquisitions	—			—			—
Foreign currency translation	(0.9		)	(0.3		)	(1.2		)
Balance as of March 30, 2013	$	144.0		$	62.9		$	206.9

9. EMPLOYEE BENEFIT PLANS

Defined Benefit Plans - As of March 30, 2013, the Company maintained two domestic pension plans and three German pension plans. The Company used a December 29 measurement date for these plans.

Other Benefits - The Company's other postretirement benefit plan provides health and life insurance to domestic employees hired prior to 1992.

The following table sets forth the aggregated net periodic benefit cost for all pension plans for the first quarters ended March 30, 2013 and March 31, 2012, respectively:

(In millions)	Pension Benefits						Other Benefits
	First Quarter Ended						First Quarter Ended
	March 30, 2013			March 31, 2012			March 30, 2013		March 31, 2012
Service cost	$	0.4		$	0.4		$	—	$	—
Interest cost	1.9			2.1			0.1		0.1
Expected return on assets	(2.5		)	(2.6		)	—		—
Prior service cost	—			—			0.1		0.1
Loss	0.9			0.5			0.1		—
Total net periodic benefit cost	$	0.7		$	0.4		$	0.3	$	0.2

In the first quarter ended March 30, 2013, the Company made contributions to the funded plans of $1.6 million. The amount of contributions to be made to the plans during the calendar year 2013 will be finalized by September 15, 2013 based upon the desired level of funding as of the December 29, 2012year-end valuation.

10. INCOME TAXES

The effective tax rate continues to be lower than the United States statutory rate of 35 percent primarily due to the indefinite reinvestment of foreign earnings taxed at rates below the U.S. statutory rate as well as recognition of foreign tax credits.  The Company has the ability to indefinitely reinvest these foreign earnings based on the earnings and cash projections of its other operations as well as cash on hand and available credit.

11. DEBT

Debt consisted of the following:

(In millions)	March 30, 2013			December 29, 2012
Prudential Agreement - 5.79 percent	$	150.0		$	150.0
Tax increment financing debt	25.0			—
Capital leases	0.9			1.0
Foreign subsidiary debt	14.9			14.9
	190.8			165.9
Less current maturities	(15.9		)	(15.2		)
Long-term debt	$	174.9		$	150.7

On December 31, 2012, the Company, Allen County, Indiana and certain institutional investors entered into a Bond Purchase and Loan Agreement. Under the agreement, Allen County, Indiana issued a series of Project Bonds entitled “Taxable Economic

13

Development Bonds, Series 2012 (Franklin Electric Co., Inc. Project).” The aggregate principal amount of the Project Bonds that were issued, authenticated, and are now outstanding thereunder was limited to $25.0 million. The Company then borrowed the proceeds under the Project Bonds through the issuance of Project Notes to finance the cost of acquisition, construction, installation and equipping of the new Global Corporate Headquarters and Engineering Center of Excellence. These Project Notes (tax increment financing debt) bear interest at 3.6 percent per annum. Interest and principal balance of the Project Notes are due and payable by the Company directly to the institutional investors in aggregate semi-annual installments commencing on July 10, 2013, and concluding on January 10, 2033. The use of the proceeds from the Project Notes is limited to assist the financing of the new Global Corporate Headquarters and Engineering Center of Excellence.

The tax increment financing debt contains customary affirmative and negative covenants. The affirmative covenants include financial statements, notices of material events, conduct of business, inspection of property, maintenance of insurance, compliance with laws and most favored lender obligations. The negative covenants include limitations on loans or advances, investments, and the granting of liens by the Company or its subsidiaries, as well as prohibitions on certain consolidations, mergers, sales and transfers of assets. The covenants also include financial requirements including a maximum leverage ratio and a minimum interest coverage ratio. Cross default is applicable with tax increment financing debt, but only if the Company is defaulting on an obligation exceeding $10.0 million.

Also, on December 31, 2012, the Company and Prudential Insurance Company of America entered into an amendment to the Second Amended and Restated Note Purchase and Private Shelf Agreement to extend the effective date to December 31, 2015.

Foreign subsidiary debt denoted in the table above is predominately comprised of debt at Impo.

The total estimated fair value of debt was $210.6 million and $179.8 million at March 30, 2013 and December 29, 2012, respectively. The fair value assumed floating rate debt was valued at par. In the absence of quoted prices in active markets considerable judgment is required in developing estimates of fair value. Estimates are not necessarily indicative of the amounts the Company could realize in a current market transaction. In determining the fair value of its long-term debt the Company uses estimates based on rates currently available to the Company for debt with similar terms and remaining maturities. Accordingly, the fair value of debt is classified as a Level 2 within the valuations hierarchy.

The following debt payments are expected to be paid in accordance with the following schedule:

(In millions)	Total		Year 1		Year 2		Year 3		Year 4		Year 5		More than 5 years
Debt	$	189.9	$	15.7	$	0.9	$	30.9	$	31.0	$	31.0	$	80.4
Capital leases	0.9		0.2		0.2		0.2		0.2		0.1		—
	$	190.8	$	15.9	$	1.1	$	31.1	$	31.2	$	31.1	$	80.4

12. EARNINGS PER SHARE

The Company calculates basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. The Company's participating securities consist of share-based payment awards that contain a nonforfeitable right to receive dividends and therefore are considered to participate in undistributed earnings with common shareholders.

Basic earnings per common share excludes dilution and is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares as of the balance sheet date, as adjusted for the potential dilutive effect of non-participating share-based awards.

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The following table sets forth the computation of basic and diluted earnings per share:

(In millions, except per share amounts)	First Quarter Ended
	March 30, 2013		March 31, 2012
Numerator:
Net income attributable to Franklin Electric Co., Inc.	$	15.5	$	23.0
Less: Undistributed earnings allocable to participating securities	0.2		—
	$	15.3	$	23.0
Denominator:
Basic
Weighted average common shares	47.3		46.8
Diluted
Effect of dilutive securities:
Non-participating employee and director incentive stock options and performance awards	0.7		1.0
Adjusted weighted average common shares	48.0		47.8
Basic earnings per share	$	0.32	$	0.49
Diluted earnings per share	$	0.32	$	0.48
Anti-dilutive stock options	—		—

Shares and per share data have been adjusted for all periods presented to reflect a two-for-one stock split effective March 18, 2013.

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13. EQUITY ROLL FORWARD

The schedule below sets forth equity changes in the three months ended March 30, 2013:

(In thousands)	Common Stock			Additional Paid in Capital		Retained Earnings			Minimum Pension Liability			Cumulative Translation Adjustment			Noncontrolling Interest		Total Equity			Redeemable Noncontrolling Interest
Balance as of December 29, 2012	$	4,712		$	170,890	$	395,950		$	(56,936	)	$	(210	)	$	2,580	$	516,986		$	5,263
Net income						15,456									209		15,665			(50		)
Dividends on common stock						(3,417		)									(3,417		)
Common stock issued	31			4,106		(9		)									4,128
Common stock repurchased or received for stock options exercised	(7		)			(2,499		)									(2,506		)
Share-based compensation	5			2,153													2,158
Tax benefit of stock options exercised				1,975													1,975
Currency translation adjustment												(5,351		)	197		(5,154		)	(635		)
Pension liability, net of taxes									590								590
Balance as of March 30, 2013	$	4,741		$	179,124	$	405,481		$	(56,346	)	$	(5,561	)	$	2,986	$	530,425		$	4,578

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14. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) by component for the three months ended March 30, 2013 and March 31, 2012 are summarized below:

(In millions)
For the Three Months Ended March 30, 2013:	Foreign Currency Translation Adjustments			Pension and Post-Retirement Plan Benefit Adjustments				Total
Balance, December 29, 2012	$	(0.2	)	$	(56.9	)		$	(57.1	)
Other comprehensive income/(loss) before reclassifications:
Pre-tax income/(loss)	(5.8		)	—				(5.8		)
Income tax expense	—			—				—
Other comprehensive income/(loss) before reclassifications, net of income taxes	(5.8		)	—				(5.8		)
Amounts reclassified from accumulated other comprehensive income/(loss):
Pre-tax income	—			1.0			(1)	1.0
Income tax expense	—			(0.4		)		(0.4		)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	—			0.6				0.6
Net current period other comprehensive income/(loss), net of income taxes	(5.8		)	0.6				(5.2		)
Comprehensive loss attributable to noncontrolling interest	0.4			—				0.4
Balance, March 30, 2013	$	(5.6	)	$	(56.3	)		$	(61.9	)
For the Three Months Ended March 31, 2012:
Balance, December 31, 2011	$	(2.1	)	$	(47.2	)		$	(49.3	)
Other comprehensive income/(loss) before reclassifications:
Pre-tax income/(loss)	11.2			—				11.2
Income tax expense	—			—				—
Other comprehensive income/(loss) before reclassifications, net of income taxes	11.2			—				11.2
Amounts reclassified from accumulated other comprehensive income/(loss):
Pre-tax income	—			0.6			(1)	0.6
Income tax expense	—			(0.2		)		(0.2		)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	—			0.4				0.4
Net current period other comprehensive income/(loss), net of income taxes	11.2			0.4				11.6
Comprehensive loss attributable to noncontrolling interest	0.3			—				0.3
Balance, March 31, 2012	$	9.4		$	(46.8	)		$	(37.4	)

(1) This accumulated other comprehensive income (loss) component is included in the computation of net periodic pension cost (refer to Note 9 for additional details) and is included in the "Selling, general, and administrative expenses" line of the condensed consolidated statements of income.

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15. SEGMENT INFORMATION

Financial information by reportable business segment is included in the following summary:

	First Quarter Ended				First Quarter Ended
(In millions)	March 30, 2013		March 31, 2012		March 30, 2013			March 31, 2012
	Net sales to external customers				Operating income (loss)
Water Systems	$	176.4	$	165.0	$	28.7		$	26.8
Fueling Systems	46.1		36.9		6.2			5.6
Other	—		—		(11.7		)	(11.4		)
Consolidated	$	222.5	$	201.9	$	23.2		$	21.0
	March 30, 2013		December 29, 2012
	Total assets
Water Systems	$	713.0	$	692.0
Fueling Systems	258.1		252.0
Other	25.4		32.4
Consolidated	$	996.5	$	976.4

Cash is the major asset group in “Other” of total assets.

16. CONTINGENCIES AND COMMITMENTS

In August 2010, the California Air Resources Board (“CARB”) filed a civil complaint in the Los Angeles Superior Court against the Company and Franklin Fueling Systems, Inc. (a wholly-owned subsidiary of the Company).  The complaint relates to a third-party-supplied component part of the Company's Healy 900 Series nozzle, which is part of the Company's Enhanced Vapor Recovery (“EVR”) Systems installed in California gasoline filling stations.  This part, a diaphragm, was the subject of a retrofit during the first half of 2008.  As the Company previously reported, in October 2008 CARB issued a Notice of Violation to the Company alleging that the circumstances leading to the retrofit program violated California statutes and regulations.  The Company and CARB worked to resolve the diaphragm matter without court action, but were unable to reach agreement.

The claims in the complaintmirror those that CARB presented to the Company in the Notice of Violation, and include claims that the Company negligently and intentionally sold nozzles with a modified diaphragm without required CARB certification.  The Company believes that, throughout the period to which the complaint relates, it acted in full cooperation with CARB and in the best interests of CARB's vapor emissions control program.  Although the complaint seeks penalties of at least $25.0 million, it is the Company's position that there is no reasonable basis for penalties of this amount.

In addition, as the Company has previously reported, the Sacramento Metropolitan Air Quality Management District (“SMAQMD”) issued a Notice of Violation to the Company concerning the diaphragm matter in March 2008.  Discussions with that agency about the circumstances leading to the retrofit in its jurisdiction and the resolution of the agency's concerns did not result in agreement, and in November 2010 SMAQMD filed a civil complaint in the Sacramento Superior Court, mirroring the claims brought by CARB with respect to the diaphragm issue and also alleging violation of SMAQMD rules.  SMAQMD's suit asks for at least $5.0 million in penalties for the violations claimed in its jurisdiction.

In July 2010, the Company entered into a tolling agreement with the South Coast Air Quality Management District (“SCAQMD”) and began discussions with that agency about the circumstances leading to the retrofit in its jurisdiction and the resolution of the agency's concerns.  Those discussions did not result in agreement and in December 2010, SCAQMD filed a civil complaint against the Company in Los Angeles Superior Court.  The complaint alleges violations of California statutes and regulations, similar to the complaint filed by CARB, as well as violation of SCAQMD rules, and seeks penalties of at least $12.5 million.  The SCAQMD complaint does not allege an intentional violation of any statute, rule, or regulation. This case was consolidated with the CARB case in Los Angeles Superior Court.

The Company believes that there is no reasonable basis for the amount of penalties claimed in the SMAQMD and SCAQMD suits.  The Company answered the SMAQMD and SCAQMD complaints, as well as the CARB complaint, denying liability and asserting affirmative defenses. The consolidated CARB/SCAQMD cases were tried to the Court in the latter part of

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December 2012 through early January 2013. In their respective post-trial briefs, CARB requested a civil penalty award of approximately $15.8 million and SCAQMD requested a civil penalty award of approximately $2.1 million. The SMAQMD case is set for trial beginning May 20, 2013. Penalties awarded in the CARB or any air district proceedings or payments resulting from a settlement of these matters, depending on the amount, could have a material adverse effect on the Company's financial position, results of operations, and net cash flows.

None of these suits have any effect on CARB's certification of the Company's EVR System or any other products of the Company or its subsidiaries, and so do not interfere with continuing sales.  CARB has never decertified the Company's EVR System and does not propose to do so now. 

On April 1, 2013, the U.S. court of Appeals for the Sixth Circuit affirmed judgment as a matter of law for the Company, dismissing claims brought in July 2009, by Sta-Rite Industries, LLC and Pentair, Inc. Those claims originally were brought against the Company in the U.S. District Court for the Northern District of Ohio, alleging breach of the parties' 2004 Settlement Agreement and tortious interference with contract based on the Company's pricing of submersible electric products, and sought damages in excess of $10.0 million for each claimant. The Company denied liability, defended the case vigorously, and filed a counterclaim alleging Sta-rite and Pentair's breach of the same Settlement Agreement. Both the Company and Sta-Rite/Pentair filed Motions for Summary Judgment in February 2011. The district judge granted the Company's motion and dismissed Sta-Rite/Pentair's claims against it in September 2011. The judge also granted Sta-Rite/Pentair's motion for Summary Judgment and dismissed the Company's counterclaim. Sta-rite/Pentair appealed the dismissal of its claims. The April 1, 2013 affirmance by the Court of Appeals terminates the appeal and the litigation, unless Sta-Rite/Pentair petition for appeal to the U.S. Supreme Court.

The Company is defending various other claims and legal actions, including environmental matters, which have arisen in the ordinary course of business. In the opinion of management, based on current knowledge of the facts and after discussion with counsel, these claims and legal actions can be successfully defended or resolved without a material adverse effect on the Company’s financial position, results of operations, and net cash flows.

At March 30, 2013, the Company had $24.7 million of commitments primarily for the purchase of machinery and equipment as well as conditional agreements related to building expansions.

The Company provides warranties on most of its products. The warranty terms vary but are generally two years from date of manufacture or one year from date of installation. In 2007, the Company began offering an extended warranty program to certain Water Systems customers which provides warranty coverage up to five years from the date of manufacture. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. The Company actively studies trends of warranty claims and takes action to improve product quality and minimize warranty claims. The Company believes that the warranty reserve is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the reserve.

The changes in the carrying amount of the warranty accrual, as recorded in "Accrued expenses" in the Company's condensed consolidated balance sheet for the three months ended March 30, 2013, are as follows:

(In millions)
Beginning balance	$	9.7
Accruals related to product warranties	1.8
Additions related to acquisitions	—
Reductions for payments made	(2.0		)
Ending balance	$	9.5

17. SHARE-BASED COMPENSATION

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The Franklin Electric Co., Inc. 2012 Stock Plan (the "2012 Stock Plan") is a stock-based compensation plan that provides for discretionary grants of stock options, stock awards, stock unit awards and performance awards to key employees and non-employee directors. Shares and per share data below have been adjusted for all periods presented to reflect the two-for-one stock split effective March 18, 2013.

The 2012 Stock Plan authorizes 2,400,000 shares for issuance as follows:

2012 Stock Plan	Authorized Shares
Stock Options	1,680,000
Stock/Stock Unit Awards	720,000

The Company also maintains the Amended and Restated Franklin Electric Co., Inc. Stock Plan (the “Stock Plan”) which, as amended in 2009, provided for discretionary grants of stock options and stock awards. The Stock Plan authorized 4,400,000 shares for issuance as follows:

Stock Plan	Authorized Shares
Stock Options	3,200,000
Stock Awards	1,200,000

All options in the Stock Plan have been awarded. The Company currently issues new shares from its common stock balance to satisfy option exercises and stock and stock unit awards under the Stock Plan. The Company currently issues options, restricted stock/stock unit and performance awards under the 2012 Stock Plan.

Stock Options:

The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model with a single approach and amortized using a straight-line attribution method over the option’s vesting period.  

The assumptions used for the Black-Scholes model to determine the fair value of options granted during the first quarter ended March 30, 2013, are as follows:

	March 30, 2013
Risk-free interest rate	1.03	%
Dividend yield	0.89	%
Volatility factor	0.394
Expected term	6.0 years
Forfeiture rate	4.52	%

There were 176,168 stock options granted during the first quarter ended March 30, 2013. There were no stock options granted during the first quarter ended March 31, 2012.

A summary of the Company’s outstanding stock option activity and related information for the first quarters ended March 30, 2013 and March 31, 2012 is as follows:

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(Shares in thousands)	March 30, 2013				March 31, 2012
Stock Options	Shares		Weighted-Average Exercise Price		Shares		Weighted-Average Exercise Price
Outstanding at beginning of period	2,184		$	16.69	3,138		$	14.83
Granted	176		32.53		—		—
Exercised	(307	)	13.43		(194	)	13.46
Forfeited	—		—		(32	)	24.44
Outstanding at end of period	2,053		$	18.54	2,912		$	14.94
Expected to vest after applying forfeiture rate	2,022		$	18.39	2,892		$	14.95
Vested and exercisable at end of period	1,457		$	15.82	2,356		$	15.18

A summary of the weighted average remaining contractual term and aggregate intrinsic value for the first quarter ended March 30, 2013 is as follows:

Stock Options	Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value (000's)
Outstanding end of period	5.94 years	$	30,874
Expected to vest after applying forfeiture rate	5.89 years	$	30,691
Vested and exercisable end of period	4.72 years	$	25,861

The total intrinsic value of options exercised during the first quarter ended March 30, 2013 and March 31, 2012, was $4.8 million and $2.3 million, respectively.

As of March 30, 2013, there was $2.6 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the 2012 Stock Plan and the Stock Plan related to stock options.  That cost is expected to be recognized over a weighted-average period of 2.74 years.

Stock/Stock Unit Awards:

A summary of the Company’s restricted stock/stock unit award activity and related information for the first quarters ended March 30, 2013 and March 31, 2012 is as follows:

(Shares in thousands)	March 30, 2013				March 31, 2012
Stock/Stock Unit Awards	Shares		Weighted-Average Grant- Date Fair Value		Shares		Weighted-Average Grant-Date Fair Value
Non-vested at beginning of period	458		$	20.90	344		$	17.24
Awarded	141		32.53		8		26.76
Vested	(35	)	17.21		(4	)	16.10
Forfeited	(1	)	18.89		(6	)	18.35
Non-vested at end of period	563		$	24.04	342		$	17.46

As of March 30, 2013, there was $8.9 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the 2012 Stock Plan and Stock Plan related to stock awards.  That cost is expected to be recognized over a weighted-average period of 3.14 years.

18. RESTRUCTURING

Restructuring expenses for the first quarter of 2013 were approximately $0.7 million, and related to severance.

Costs incurred in the first quarter ended March 30, 2013, included in the “Restructuring expense” line of the Company's condensed consolidated statement of income, are as follows:

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(In millions)	First Quarter Ended
	March 30, 2013
	Water Systems		Fueling Systems		Other		Consolidated
Employee severance	$	0.5	$	0.2	$	—	$	0.7

Restructuring expense of $(0.1) million was incurred in the first quarter ended March 31, 2012, which resulted from a gain on the sale of land the Company had previously held for development, but that was subsequently sold in the first quarter of 2012.

As of March 30, 2013, there was $0.6 million in restructuring reserves primarily for severance. As of March 31, 2012, there were no restructuring reserves.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Q1 2013 vs. Q1 2012

OVERVIEW

Sales and earnings after non-GAAP adjustments in the first quarter of 2013 were up from last year.  The sales increase was related to the Company's acquisitions, as well as sales volume increases which were partially offset by the negative impact of foreign currency translation. The Company's consolidated gross profit was $73.9 million for the first quarter of 2013, an increase of $7.6 million or about 11 percent from the prior year's first quarter. The gross profit as a percent of net sales increased 40 basis points to 33.2 percent in 2013 from 32.8 percent in first quarter of 2012. The gross profit margin increase was primarily due to lower raw material, direct labor and variable costs, partially offset by higher fixed costs. The Company completed a 2-for-1 stock split on March 18, 2013, and all EPS amounts are presented on a post-split basis.

RESULTS OF OPERATIONS

Net Sales

Net sales in the first quarter of 2013 were $222.5 million, an increase of $20.6 million or about 10 percent compared to 2012 first quarter sales of $201.9 million.  The incremental impact of sales from acquired businesses was $12.8 million or about 6 percent.  Sales revenue decreased by $4.6 million or about 2 percent in the first quarter of 2013 due to foreign currency translation. The sales change in the first quarter of 2013, excluding acquisitions and foreign currency translation, was an increase of $12.4 million or about 6 percent.

(In millions)	Q1 2013		Q1 2012		Q1 2013 v Q1 2012
	Net Sales
Water Systems	$	176.4	$	165.0	$	11.4
Fueling Systems	46.1		36.9		9.2
Consolidated	$	222.5	$	201.9	$	20.6

Net Sales-Water Systems

Water Systems revenues were $176.4 million in the first quarter 2013, an increase of $11.4 million or about 7 percent versus the first quarter 2012 sales of $165.0 million. Sales from businesses acquired since the first quarter of 2012 were $9.9 million or 6 percent. Water Systems sales were reduced by $4.5 million or about 3 percent in the quarter due to foreign currency translation. Water Systems sales growth, excluding acquisitions and foreign currency translation, was about 4 percent.

Water Systems sales in the U.S. and Canada represent about 38 percent of the Company's consolidated sales and grew by about 12 percent during the quarter. Excluding acquisitions and the impact of foreign currency translation, U.S. and Canada sales growth was flat compared to the first quarter 2012, as sales of groundwater and wastewater pumps to the U.S. residential water market increased by about 5 percent and sales to the irrigation and industrial market increased by about 12 percent; but these gains were partially offset by lower sales of mobile pumps used in the oil and gas market.

Water Systems sales in Latin America were about 14 percent of consolidated sales for the quarter and were up about 1 percent compared to the first quarter of the prior year. Latin American sales were reduced by about 8 percent in the quarter due to foreign currency translation. Excluding acquisitions and the impact of foreign currency translation, Latin American sales were up about 9 percent compared to the first quarter 2012. The sales growth in Latin America was driven in large part by strong sales in Brazil, partially offset by lower sales in Argentina.

Water Systems sales in Europe were about 8 percent of consolidated sales and grew by about 6 percent compared to the first quarter 2012. Excluding acquisitions and the impact of foreign currency translation, European sales increased about 2 percent compared to the first quarter 2012. The Company's European management team has increased sales and improved margins in spite of the slow economy and unusually cold and wet weather conditions during this winter and early spring.

Water Systems sales in the Middle East and Africa were about 11 percent of consolidated sales and declined by about 1 percent compared to the first quarter 2012. The decline was attributable to foreign currency translation. Excluding acquisitions and the impact of foreign currency translation, sales were up about 6 percent compared to the first quarter 2012. Sales in the Gulf

23

region and Turkey grew by about 10 percent during the first quarter on strong demand for water well equipment. Impo, the Turkish pump and motor company that the Company acquired in 2011, continues to perform well and provide additional opportunities for the Company in the region.

Water Systems sales in the Asia Pacific region were 8 percent of consolidated sales and increased by about 8 percent compared to the first quarter prior year. Excluding acquisitions and the impact of foreign currency translation, Asia Pacific sales were up about 7 percent compared to the first quarter 2012. Sales in Southeast Asia grew by 27 percent compared to the first quarter prior year, as the Company continues to benefit from the improved customer service levels attributable to a new distribution center in Singapore. Sales in Australia grew by 20 percent, aided in part by the launch of the new solar powered water well pumping system. Sales in Taiwan declined versus prior year due to the timing of distributor replenishment orders.

Net Sales-Fueling Systems

Fueling Systems sales were $46.1 million in the first quarter 2013, an increase of $9.2 million or about 25 percent versus the first quarter 2012 sales of $36.9 million. Sales from businesses acquired since the first quarter of 2012 were $2.9 million or about 8 percent. Fueling Systems sales were reduced by $0.1 million or less than 1 percent in the quarter due to foreign currency translation. Fueling Systems sales growth, excluding acquisitions and foreign currency translation, was about 17 percent.

The first quarter Fueling Systems sales growth was led by sales increases in developing regions, specifically India, which grew by 72 percent compared to the prior year, where filling station owners are continuing to convert from suction pumping systems to the Franklin pressure pumping system in order to transfer gasoline from underground tanks to the dispensers. While about 95 percent of the 175,000 filling stations in the U.S. have already made this conversion, the Company estimates that only about 20 percent of the 300,000 stations in the developing world have converted, so the Company anticipates that sales will continue to benefit from this conversion in the developing regions for the foreseeable future. This is particularly encouraging because when a station owner converts to the Franklin pressure pumping system, it provides the opportunity for selling Franklin piping, containment and leak detection products as well because these products are specifically designed to enhance the overall performance of a pressure pumping system.

Cost of Sales

Cost of sales as a percent of net sales for the first quarter of 2013 and 2012 was 66.8 percent and 67.2 percent, respectively. Correspondingly, the gross profit margin increased to 33.2 percent from 32.8 percent, a 40 basis point improvement. The Company's consolidated gross profit was $73.9 million for the first quarter of 2013, an increase of $7.6 million, or about 11 percent, from the first quarter of 2012 gross profit of $66.3 million. The gross profit margin increase was primarily due to lower raw material, direct labor and variable costs, partially offset by higher fixed costs.

Selling, General and Administrative (“SG&A”)

Selling, general, and administrative (SG&A) expenses were $50.1 million in the first quarter of 2013 compared to $45.3 million from the first quarter of prior year, an increase of $4.8 million or about 10 percent. In the first quarter 2013, increases in SG&A attributable to acquisitions were $3.2 million. Additional increases in SG&A costs during the first quarter of 2013 resulted from increased costs for marketing and selling-related expenses of $1.2 million. These costs increased to support the integration of the Cerus product line, the launch of the Company's pump rental initiative, the commercialization of the Company's new artificial lift product offering and opening new product distribution centers.

Restructuring Expenses

Restructuring expenses for the first quarter of 2013 were $0.7 million and reduced diluted earnings per share by approximately $0.01. Restructuring expenses were primarily severance expenses, as well as Flex-ing acquisition integration activities, and other miscellaneous manufacturing realignment activities. Restructuring expenses last year were $(0.1) million and had no impact on diluted earnings per share. Restructuring expenses in the first quarter of 2012 resulted from a gain on the sale of land the Company had previously held for development, but that was subsequently sold in the first quarter of 2012.

Operating Income

Operating income was $23.2 million in the first quarter of 2013, up $2.2 million or about 10 percent from $21.0 million in the first quarter of 2012.

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(In millions)	Q1 2013			Q1 2012			Q1 2013 v Q1 2012
	Operating income (loss)
Water Systems	$	28.7		$	26.8		$	1.9
Fueling Systems	6.2			5.6			0.6
Other	(11.7		)	(11.4		)	(0.3		)
Consolidated	$	23.2		$	21.0		$	2.2

There were specific items in the first quarter of 2013 and 2012 that impacted operating income that were not operational in nature.  In the first quarter of 2013 there were two such items: $0.7 million of restructuring charges and $0.4 million for certain legal matters. In the first quarter of 2012, there were two items related to the Pioneer transaction considered non-operational. The first is approximately $0.2 million in costs to complete the transaction and the second is approximately $0.2 million in the amortization of increased inventory value as required by GAAP. The first quarter of 2012 included a gain of $0.1 million in restructuring charges.

The Company refers to these items as “non-GAAP adjustments” for purposes of presenting the non-GAAP financial measures of operating income after non-GAAP adjustments and percent operating income to net sales after non-GAAP adjustments to net sales (operating income margin after non-GAAP adjustments).  The Company believes this information helps investors understand underlying trends in the Company's business more easily.  The differences between these non-GAAP financial measures and the most comparable GAAP measures are reconciled in the following tables:

Operating Income and Margins
Before and After Non-GAAP Adjustments
(in millions)	For the First Quarter 2013
	Water			Fueling			Other			Consolidated
Reported Operating Income	$	28.7		$	6.2		$	(11.7	)	$	23.2
% Operating Income To Net Sales	16.3		%	13.4		%				10.4		%
Non-GAAP Adjustments:
Restructuring	$	0.5		$	0.2		$	—		$	0.7
Legal matters	$	—		$	0.4		$	—		$	0.4
Acquisition related items	$	—		$	—		$	—		$	—
Operating Income after Non-GAAP Adjustments	$	29.2		$	6.8		$	(11.7	)	$	24.3
% Operating Income to Net Sales after Non-GAAP Adjustments (Operating Income Margin after Non-GAAP Adjustments)	16.6		%	14.8		%				10.9		%
	For the First Quarter 2012
	Water			Fueling			Other			Consolidated
Reported Operating Income	$	26.8		$	5.6		$	(11.4	)	$	21.0
% Operating Income To Net Sales	16.2		%	15.2		%				10.4		%
Non-GAAP Adjustments:
Restructuring	$	(0.1	)	$	—		$	—		$	(0.1	)
Legal matters	$	—		$	—		$	—		$	—
Acquisition related items	$	0.4		$	—		$	—		$	0.4
Operating Income after Non-GAAP Adjustments	$	27.1		$	5.6		$	(11.4	)	$	21.3
% Operating Income to Net Sales after Non-GAAP Adjustments (Operating Income Margin after Non-GAAP Adjustments)	16.4		%	15.2		%				10.5		%

Operating Income-Water Systems

25

Water Systems operating income, after non-GAAP adjustments, was $29.2 million in the first quarter 2013, an increase of 8 percent versus the first quarter 2012. The first quarter operating income margin after non-GAAP adjustments was 16.6 percent an increase of 20 basis points compared to the first quarter of 2012. This margin increase was primarily the result of lower raw material, direct labor and variable costs, partially offset by higher Research and Development and other new product introduction sales and marketing costs.

Operating Income-Fueling Systems

Fueling Systems operating income after non-GAAP adjustments was $6.8 million in the first quarter of 2013 compared to $5.6 million after non-GAAP adjustments in the first quarter of 2012, an increase of 21 percent. The first quarter operating income margin after non-GAAP adjustments was 14.8 percent and decreased by 40 basis points compared to the 15.2 percent of net sales in the first quarter of 2012. Operating income margin after non-GAAP adjustments declined in Fueling Systems primarily due to product sales mix during the quarter.

Operating Income-Other

Operating income-other is composed primarily of unallocated general and administrative expenses.  General and administrative expenses were higher primarily due to stock based compensation expenses.

Interest Expense

Interest expense for both the first quarter of 2013 and 2012 was $2.6 million.

Other Income or Expense

Other income or expense was income of $0.4 million in the first quarter of 2013 and income of $13.5 million in the first quarter of 2012.  Included in other income in the first quarter of 2013 was interest income of $0.4 million, primarily derived from the investment of cash balances in short-term securities. Included in other income in the first quarter of 2012 was a one-time gain on the Pioneer transaction worth $12.2 million. The gain on the original investment the Company had held in Pioneer arises as a the result of a new enterprise valuation of the Pioneer entity that is then compared to the book value of the equity investment Franklin Electric had previously made in Pioneer. Also included in other income for the first quarter of 2012 was income from equity investments of $0.6 million and interest income of $0.8 million, primarily derived from the investment of cash balances in short-term securities.

Foreign Exchange

Foreign currency-based transactions produced a loss for the first quarter of 2013 of $0.2 million, primarily due to the South African rand.  Foreign currency-based transactions produced a loss in the first quarter of 2012 of $0.3 million; the loss was primarily due to rate changes in several European currencies, primarily the Czech koruna and euro, relative to the U.S. dollar, partially offset by gains from the Mexican peso.

Income Taxes

The provision for income taxes in the first quarter of 2013 and 2012 was $5.2 million and $8.5 million, respectively. The effective tax rate for the first quarter of 2013 was about 25 percent and, before the impact of discrete events, was 28 percent, which the Company believes is also a reasonable estimate for full year 2013. The projected tax rate is consistent with the 2012 tax rate and lower than the statutory rate of 35 percent primarily due to the indefinite reinvestment of foreign earnings and reduced taxes on foreign and repatriated earnings after the restructuring of certain foreign entities. The Company has the ability to indefinitely reinvest these foreign earnings based on the earnings and cash projections of its other operations, current cash on hand and available credit.

Net Income

Net income for the first quarter of 2013 was $15.6 million compared to the prior year first quarter net income of $23.2 million.  Net income attributable to Franklin Electric Co., Inc. for the first quarter of 2013 was $15.5 million, or $0.32 per diluted share, compared to the prior year first quarter net income attributable to Franklin Electric Co., Inc. of $23.0 million or $0.48 per diluted share. Earnings after non-GAAP adjustments for the first quarter of 2013 were $15.9 million, or $0.33 per diluted share, compared to the prior year first quarter earnings after non-GAAP adjustments of $14.3 million or $0.30 per diluted share.

There were specific items in the first quarter of 2013 and 2012 that impacted net income attributable to Franklin Electric Co., Inc. that were not operational in nature.  The Company refers to these items as “non-GAAP adjustments” for purposes of presenting the non-GAAP financial measures of earnings after non-GAAP adjustments and adjusted EPS.  The Company believes this information helps investors understand underlying trends in the Company's business more easily.  The differences between these non-GAAP financial measures and the most comparable GAAP measures are reconciled in the following tables:

26

Earnings Before and After Non-GAAP Adjustments	For the First Quarter
(in millions)	2013			2012			Change
Net Income attributable to Franklin Electric Co., Inc. Reported	$	15.5		$	23.0		(33	)%
Allocated Undistributed Earnings	$	(0.2	)	$	—
Adjusted Earnings for EPS Calculation	$	15.3		$	23.0
Non-GAAP adjustments (before tax):
Restructuring	$	0.7		$	(0.1	)
Legal matters	$	0.4		$	—
Acquisition related items	$	—		$	0.4
Gain on Pioneer Investment	$	—		$	(12.2	)
Non-GAAP adjustments, net of tax:
Restructuring	$	0.4		$	(0.1	)
Legal matters	$	0.2		$	—
Acquisition related items	$	—		$	0.3
Gain on Pioneer Investment	$	—		$	(8.9	)
Earnings after Non-GAAP Adjustments	$	15.9		$	14.3		11	%

Earnings Per Share Before and After Non-GAAP Adjustments	For the First Quarter
(in millions except Earnings Per Share)	2013		2012			Change
Average Fully Diluted Shares Outstanding	48.0		47.8			—	%
Fully Diluted Earnings Per Share ("EPS") Reported	$	0.32	$	0.48		(33	)%
Restructuring Per Share, net of tax	$	0.01	$	—
Legal matters Per Share, net of tax	$	—	$	—
Acquisition related items Per Share, net of tax	$	—	$	0.01
Gain on Pioneer Investment Per Share, net of tax	$	—	$	(0.19	)
Fully Diluted EPS after Non-GAAP Adjustments (Adjusted EPS)	$	0.33	$	0.30		10	%

CAPITAL RESOURCES AND LIQUIDITY

The Company's primary sources of liquidity are cash on hand, cash flows from operations and long-term debt funds available.

On December 31, 2012, the Company, Allen County, Indiana and certain institutional investors entered into a Bond Purchase and Loan Agreement. Under the agreement, Allen County, Indiana issued a series of Project Bonds entitled “Taxable Economic Development Bonds, Series 2012 (Franklin Electric Co., Inc. Project).” The aggregate principal amount of the Project Bonds that were issued, authenticated, and are now outstanding thereunder was limited to $25.0 million. The Company then borrowed the proceeds under the Project Bonds through the issuance of Project Notes to finance the cost of acquisition, construction, installation and equipping of the new Global Corporate Headquarters and Engineering Center of Excellence. The Project Notes (tax increment financing debt) bear interest at 3.6 percent per annum. Interest and principal balance of the Project Notes are due and payable by the Company directly to the institutional investors in aggregate semi-annual installments

27

commencing on July 10, 2013, and concluding on January 10, 2033. The use of the proceeds from the Project Notes is limited to assist the financing of the new Global Corporate Headquarters and Engineering Center of Excellence.

The Agreement contains customary affirmative and negative covenants. The affirmative covenants include financial statements, notices of material events, conduct of business, inspection of property, maintenance of insurance, compliance with laws and most favored lender obligations. The affirmative covenants also include financial covenants with a maximum leverage ratio of 3.50 to 1.00 and an interest coverage ratio equal to or greater than 3.00 to 1.00. The negative covenants include limitations on loans or advances, investments, and the granting of liens by the Company or its subsidiaries, as well as prohibitions on certain consolidations, mergers, sales and transfers of assets, and a cross-default provision.

The Company also has an amended and restated uncommitted note purchase and private shelf agreement (the “Prudential Agreement”) in the amount of $200.0 million, with $150.0 million of notes issued thereunder beginning to mature in 2015. The Company has no scheduled principal payments under the Prudential Agreement until 2015 at which time it amortizes for 5 years at an amount of $30.0 million per year. As of March 30, 2013, the Company had $50.0 million borrowing capacity under the Prudential Agreement.

In addition, the Company has a committed, unsecured, revolving credit agreement maturing on December 14, 2016 (the “Agreement”) in the amount of $150.0 million. As of March 30, 2013, the Company had $145.4 million borrowing capacity under the Agreement as $4.6 million in letters of credit were outstanding and undrawn.

The Agreement, the Prudential Agreement, and the tax increment financing debt contain customary affirmative and negative covenants. The affirmative covenants include financial statements, notices of material events, conduct of business, inspection of property, maintenance of insurance, compliance with laws and most favored lender obligations. The negative covenants include limitations on loans or advances, investments, and the granting of liens by the Company or its subsidiaries, as well as prohibitions on certain consolidations, mergers, sales and transfers of assets. The covenants also include financial requirements including a maximum leverage ratio of 3.50 to 1.00 and a minimum interest coverage ratio of 3.00 to 1.00. Cross default is applicable with the Agreement, the Prudential Agreement, and the tax increment financing debt, but only if the Company is defaulting on an obligation exceeding $10.0 million. As of March 30, 2013, the Company was in compliance with all covenants. Volatility in the financial and credit markets due to global financial events within the past 5 years has generally not adversely impacted the liquidity of the Company and the Company expects that ongoing requirements for operations, capital expenditures, pension obligations, dividends, and debt service will be adequately funded from cash on hand, operations, and existing credit agreements.

The Company is constructing a new Global Corporate Headquarters and Engineering Center of Excellence on property it acquired in the Fort Wayne, Indiana metropolitan area.  The approximately 110,000 square foot building is expected to be completed by mid-2013.  Estimates for the land acquisition and improvement and building construction costs, without giving effect to any economic development incentives, are in the range of approximately $36.0 to $38.0 million.

At March 30, 2013, the Company had $74.7 million of cash on hand at various locations worldwide. Approximately 15% of the cash on hand was in the U.S. and readily accessible. Another approximately 35% was in Germany, Italy, and the Czech Republic combined, and then another 30% was in Mexico and Brazil combined. On a regular basis the Company reviews international cash balances and, if appropriate based on forecasted expenditures and considerations for the post-tax economic efficiency, will reposition cash among its global entities. Cash investments worldwide are invested according to a written policy and are generally in bank demand accounts and bank time deposits with the preservation of principal as the highest priority. Also, historically the Company has generally sourced inputs and sold outputs both in the local currency of operations on a country by country basis, thereby insulating local cash balances from currency volatility.

Net use of cash from operating activities was $30.8 million for the first quarter ended March 30, 2013, compared to $29.0 million for the first quarter ended March 31, 2012. The first quarter of 2012 contained the one time effect of a non-cash gain on PPH of $12.2 million that was recorded in net income.

Net cash used in investing activities was $16.4 million for the first quarter ended March 30, 2013, compared to $30.8 million for the first quarter ended March 31, 2012. The primary decrease in cash used in investing activities is due to no acquisition related activity during the current period compared to $27.9 million of cash paid for the acquisition of PPH during the first quarter of 2012. Additions to property, plant and equipment were significantly higher in first quarter 2013 compared to first quarter 2012 due to the Global Corporate Headquarters and Engineering Center of Excellence project and the new manufacturing facility in Brazil. In evaluating potential future acquisitions that impact cash from investing, the Company reviews opportunities with an emphasis on increasing global distribution and also with an emphasis on adding complementary product lines that can be effectively marketed through existing global distribution.

28

Net cash provided by financing activities was $19.7 million for the first quarter ended March 30, 2013, compared to $2.2 million for the first quarter ended March 31, 2012. The primary increase in cash provided by financing activities in first quarter 2013 is attributed to the new borrowings received by the Company in the sum of $25.0 million on December 31, 2012. In addition, the Company paid out contingent consideration in the current period of $5.6 million related to Impo.

FACTORS THAT MAY AFFECT FUTURE RESULTS

This quarterly report on Form 10-Q contains certain forward-looking information, such as statements about the Company’s financial goals, acquisition strategies, financial expectations including anticipated revenue or expense levels, business prospects, market positioning, product development, manufacturing re-alignment, capital expenditures, tax benefits and expenses, and the effect of contingencies or changes in accounting policies.  Forward-looking statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “may increase,” “may fluctuate,” “plan,” “goal,” “target,” “strategy,” and similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would,” and “could.”  While the Company believes that the assumptions underlying such forward-looking statements are reasonable based on present conditions, forward-looking statements made by the Company involve risks and uncertainties and are not guarantees of future performance. Actual results may differ materially from those forward-looking statements as a result of various factors, including regional or general economic and currency conditions, various conditions specific to the Company’s business and industry, new housing starts, weather conditions, market demand, competitive factors, changes in distribution channels, supply constraints, effect of price increases, raw material costs and availability, technology factors, integration of acquisitions, litigation, government and regulatory actions, the Company’s accounting policies, and other risks, all as described in the Company's Securities and Exchange Commission filings, included in Part I, Item 1A of the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012, and in Exhibit 99.1 thereto.  Any forward-looking statements included in this Form 10-Q are based upon information presently available. The Company does not assume any obligation to update any forward-looking information, except as required by law.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no significant changes in the Company's exposure to market risk during the first quarter ended March 30, 2013. For additional information, refer to Part II, Item 7A of the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012.

ITEM 4. CONTROLS AND PROCEDURES

As of the end of the period covered by this report (the “Evaluation Date”), the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and the Company’s Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, the Company’s Chief Executive Officer and the Company’s Chief Financial Officer concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures were effective.

There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15 under the Exchange Act during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

29

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In August 2010, the California Air Resources Board (“CARB”) filed a civil complaint in the Los Angeles Superior Court against the Company and Franklin Fueling Systems, Inc. (a wholly-owned subsidiary of the Company).  The complaint relates to a third-party-supplied component part of the Company's Healy 900 Series nozzle, which is part of the Company's Enhanced Vapor Recovery (“EVR”) Systems installed in California gasoline filling stations.  This part, a diaphragm, was the subject of a retrofit during the first half of 2008.  As the Company previously reported, in October 2008 CARB issued a Notice of Violation to the Company alleging that the circumstances leading to the retrofit program violated California statutes and regulations.  The Company and CARB worked to resolve the diaphragm matter without court action, but were unable to reach agreement.

The claims in the complaintmirror those that CARB presented to the Company in the Notice of Violation, and include claims that the Company negligently and intentionally sold nozzles with a modified diaphragm without required CARB certification.  The Company believes that, throughout the period to which the complaint relates, it acted in full cooperation with CARB and in the best interests of CARB's vapor emissions control program.  Although the complaint seeks penalties of at least $25.0 million, it is the Company's position that there is no reasonable basis for penalties of this amount.

In addition, as the Company has previously reported, the Sacramento Metropolitan Air Quality Management District (“SMAQMD”) issued a Notice of Violation to the Company concerning the diaphragm matter in March 2008.  Discussions with that agency about the circumstances leading to the retrofit in its jurisdiction and the resolution of the agency's concerns did not result in agreement, and in November 2010 SMAQMD filed a civil complaint in the Sacramento Superior Court, mirroring the claims brought by CARB with respect to the diaphragm issue and also alleging violation of SMAQMD rules.  SMAQMD's suit asks for at least $5.0 million in penalties for the violations claimed in its jurisdiction.

In July 2010, the Company entered into a tolling agreement with the South Coast Air Quality Management District (“SCAQMD”) and began discussions with that agency about the circumstances leading to the retrofit in its jurisdiction and the resolution of the agency's concerns.  Those discussions did not result in agreement and in December 2010, SCAQMD filed a civil complaint against the Company in Los Angeles Superior Court.  The complaint alleges violations of California statutes and regulations, similar to the complaint filed by CARB, as well as violation of SCAQMD rules, and seeks penalties of at least $12.5 million.  The SCAQMD complaint does not allege an intentional violation of any statute, rule, or regulation. This case was consolidated with the CARB case in Los Angeles Superior Court.

The Company believes that there is no reasonable basis for the amount of penalties claimed in the SMAQMD and SCAQMD suits.  The Company answered the SMAQMD and SCAQMD complaints, as well as the CARB complaint, denying liability and asserting affirmative defenses. The consolidated CARB/SCAQMD cases were tried to the Court in the latter part of December 2012 through early January 2013. In their respective post-trial briefs, CARB requested a civil penalty award of approximately $15.8 million and SCAQMD requested a civil penalty award of approximately $2.1 million. The SMAQMD case is set for trial beginning May 20, 2013. Penalties awarded in the CARB or any air district proceedings or payments resulting from a settlement of these matters, depending on the amount, could have a material adverse effect on the Company's financial position, results of operations, and net cash flows.

None of these suits have any effect on CARB's certification of the Company's EVR System or any other products of the Company or its subsidiaries, and so do not interfere with continuing sales.  CARB has never decertified the Company's EVR System and does not propose to do so now.

On April 1, 2013, the U.S. Court of Appeals for the Sixth Circuit affirmed judgment as a matter of law for the Company, dismissing  claims brought in July 31, 2009, by Sta-Rite Industries, LLC and Pentair, Inc.   Those claims originally were brought against the Company in the U.S. District Court for the Northern District of Ohio, alleging breach of the parties' 2004 Settlement Agreement and tortious interference with contract based on the Company's pricing of submersible electric products, and sought damages in excess of $10.0 million for each claimant.  The Company denied liability, defended the case vigorously, and filed a counterclaim alleging Sta-Rite and Pentair's breach of the same Settlement Agreement.  Both the Company and Sta-Rite/Pentair filed Motions for Summary Judgment in February 2011. The district judge granted the Company's motion and dismissed Sta-Rite/Pentair's claims against it in September 2011. The judge also granted Sta-Rite/Pentair's motion for summary judgment and dismissed the Company's counterclaim. Sta-Rite/Pentair appealed the dismissal of its claims.  The April 1, 2013 affirmance by the Court of Appeals terminates the appeal and the litigation, unless Sta-Rite/Pentair petition for appeal to the U.S. Supreme Court. 

ITEM 1A. RISK FACTORS

There were no material changes to the risk factors set forth in Part I, Item 1A, in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012. Additional risks and uncertainties, not presently known to the Company or currently deemed immaterial, could negatively impact the Company's results of operations or financial condition in the future.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(c) Issuer Repurchases of Equity Securities

In April 2007, the Company’s Board of Directors unanimously approved a plan to increase the number of shares remaining for repurchase from 628,692 to 2,300,000 shares. There is no expiration date for the plan. The Company did not repurchase any shares under the plan during the first quarter of 2013. The maximum number of shares that may still be purchased under the Company plan as of March 30, 2013, is 1,200,913.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 6. EXHIBITS

Exhibits are set forth in the Exhibit Index located on page 32.

30

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		FRANKLIN ELECTRIC CO., INC.
		Registrant
Date: May 9, 2013	By	/s/ R. Scott Trumbull
		R. Scott Trumbull
		Chairman and Chief Executive Officer
		(Principal Executive Officer)
Date: May 9, 2013	By	/s/ John J. Haines
		John J. Haines
		Vice President and Chief Financial Officer and Secretary
		(Principal Financial and Accounting Officer)

31

FRANKLIN ELECTRIC CO., INC.

EXHIBIT INDEX TO THE QUARTERLY REPORT ON FORM 10-Q

FOR THE FIRST QUARTER ENDED MARCH 30, 2013

Number	Description
10.1	Form of Non-Qualified Stock Option Agreement for Non-Director Employees (filed herewith)*
10.2	Form of Non-Qualified Stock Option Agreement for Director Employees (filed herewith)*
10.3	Form of Restricted Stock Agreement for Non-Director Employees (filed herewith)*
10.4	Form of Restricted Stock Unit Agreement for Director Employees (filed herewith)*
10.5	Form of Restricted Stock Unit Agreement for Non-Director Employees (filed herewith)*
10.6	Form of Performance Stock Unit Award Agreement for Non-Director Employees (filed herewith)*
10.7	Form of Performance Stock Unit Award Agreement for Director Employees (filed herewith)*
10.8	Form of Employment Security Agreement between the Company and Steven W. Aikman, Daniel J. Crose, Delancey W. Davis, Robert J. Stone and Thomas J. Strupp (incorporated by reference to Exhibit 10.1 of the Company's Form 8-K filed on May 7, 2013)*
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes–Oxley Act of 2002
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes–Oxley Act of 2002
32.1	Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase

* Management Contract, Compensatory Plan or Arrangement

32

EX-10.1

EXHIBIT 10.1

[Non-Director Employees]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. 2012 Stock Plan

Non-Qualified Stock Option Agreement

The employee identified below has been selected to be a Participant in the Franklin Electric Co., Inc. 2012 Stock Plan (the “Plan”) and has been granted a Non-Qualified Option as outlined below:

Participant:

Date of Grant:

Shares Covered by the Option: *

Option Exercise Price: $

Expiration Date:

Vesting Schedule:

* The number of shares covered by the Option and the Option exercise price have been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Agreement, effective as of the Date of Grant set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Option. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless otherwise set forth herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1.Stock Option Grant. Subject to the provisions set forth herein and the terms and conditions of the Plan, and in consideration of the agreements of the Participant herein provided, the Company hereby grants to the Participant an Option to purchase from the Company the number of shares of Common Stock, at the exercise price per share, and on the schedule, set forth above.

2.Acceptance by Participant. The exercise of the Option is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Option and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Option notification from EASi.

3.Exercise of Option. Subject to Section 4 below, the Participant may exercise the vested portion of the Option at any time prior to the Expiration Date. Written notice of an election to exercise any portion of the Option shall be given by the Participant, or his personal representative in the event of the Participant's death, to the Company's Chief Financial Officer, in accordance with procedures established by the Management Organization and Compensation Committee of the Board of Directors of the Company (the “Committee”) as in effect at the time of such exercise.

At the time of exercise of the Option, payment of the purchase price for the shares of Common Stock with respect to which the Option is exercised, and of an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements, must be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted an exercise notice and irrevocable instructions to deliver the purchase price or withholding tax to the Company from the proceeds of the sale of shares subject to the Option, (c) by directing the Company to withhold such number of shares of Common Stock otherwise issuable upon exercise of the Option with a fair market value equal to the amount of the purchase price or the tax to be withheld and/or (d) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value.

No shares shall be issued upon exercise of the Option until full payment of the exercise price and tax withholding obligation has been made.

4.Exercise Upon Termination of Employment. If the Participant's employment with the Company and all subsidiaries terminates without cause (as determined by the Committee in its sole discretion) and for any reason other than death, disability or retirement, the then vested portion of the Option shall continue to be exercisable until the earlier of the 90th day after the date of the Participant's termination or the date the Option expires by its terms. The portion of the Option not vested as of the date of such termination of employment shall expire as of such date and shall not be exercisable.

If the Participant's employment with the Company and all subsidiaries is terminated by the Company for cause (as determined by the Committee in its sole discretion), the Option shall expire on the date of such termination, and no portion shall be exercisable after the date of such termination.

In the event of the Participant's death, disability or retirement during employment with the Company or any subsidiary, the outstanding portion of the Option shall become fully vested on such date. The Option shall continue to be exercisable until the earlier of (i) the date the Option expires by its terms and (ii) in the case of termination due to disability or retirement, 36 months after the date of such termination, and in the case of termination due to death, 12 months after the date of such termination. For purposes of this Section 4, (A) “disability” has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates, and (B) “retirement” means the Participant's termination from employment with the Company and all subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries.

The foregoing provisions of this Section 4 shall be subject to the provisions of any written employment or severance agreement that has been or may be executed by the Participant and the Company, and the provisions in such employment or severance agreement concerning exercise of the Option shall supersede any inconsistent or contrary provision of this Section 4.

5.Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) the then outstanding and unexercised portion of the Option (whether vested or unvested) shall be cancelled and forfeited back to the Company and (b) the Participant shall remit to the Company within 30 days of written notice from the Committee a cash payment equal to the number of shares of Common Stock subject to the portion of the Option that was previously exercised, multiplied by the excess of the fair market value of the Common Stock on the date of exercise over the Option Exercise Price. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

6.Nontransferability of Options. The Option may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution.

7.Beneficiary Designation. The Participant may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Option is to be paid in the event of his or her death. Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Board, and will be effective only when filed by the Participant in writing with the Board during his or her lifetime. In the absence of any such designation, or if all beneficiaries predecease the Participant, benefits remaining unpaid at the Participant's death shall be paid to the Participant's estate.

8.Rights as a Stockholder. The Participant shall have no rights as a stockholder of the Company with respect to the shares of Common Stock subject to the Option and this Agreement until such time as the exercise price has been paid and the shares have been issued and delivered to him or her.

9.Surrender of or Changes to Agreement. In the event the Option shall be exercised in whole, this Agreement shall be surrendered to the Company for cancellation. In the event the Option shall be exercised in part or a change in the number of designation of the shares of Common Stock shall be made, this Agreement shall be delivered by the Participant to the Company for the purpose of making appropriate notation thereon, or of otherwise reflecting, in such manner as the Company shall determine, the change in the number or designation of such shares.

10.Administration. The Option shall be exercised in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of, the Plan and this Agreement, all of which shall be binding upon the Participant.

11.Governing Law. This Agreement, and the Option, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EX-10.2

EXHIBIT 10.2

[Director Employees]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. 2012 Stock Plan

Non-Qualified Stock Option Agreement

The employee identified below has been selected to be a Participant in the Franklin Electric Co., Inc. 2012 Stock Plan (the “Plan”) and has been granted a Non-Qualified Option as outlined below:

Participant:

Date of Grant:

Shares Covered by the Option: *

Option Exercise Price: $

Expiration Date:

Vesting Schedule:

* The number of shares covered by the Option and the Option exercise price have been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Agreement, effective as of the Date of Grant set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Option. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless otherwise set forth herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1. Stock Option Grant. Subject to the provisions set forth herein and the terms and conditions of the Plan, and in consideration of the agreements of the Participant herein provided, the Company hereby grants to the Participant an Option to purchase from the Company the number of shares of Common Stock, at the exercise price per share, and on the schedule, set forth above.

2. Acceptance by Participant. The exercise of the Option is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Award and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Option notification from EASi.

3. Exercise of Option. Subject to Section 4 below, the Participant may exercise the vested portion of the Option at any time prior to the Expiration Date. Written notice of an election to exercise any portion of the Option shall be given by the Participant, or his personal representative in the event of the Participant's death, to the Company's Chief Financial Officer, in accordance with procedures established by the Management Organization and Compensation Committee of the Board of Directors of the Company (the “Committee”) as in effect at the time of such exercise.

At the time of exercise of the Option, payment of the purchase price for the shares of Common Stock with respect to which the Option is exercised, and of an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements, must be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted an exercise notice and irrevocable instructions to deliver the purchase price or withholding tax to the Company from the proceeds of the sale of shares subject to the Option, (c) by directing the Company to withhold such number of shares of Common Stock otherwise issuable upon exercise of the Option with a fair market value equal to the amount of the purchase price or the tax to be withheld and/or (d) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value.

No shares shall be issued upon exercise of the Option until full payment of the exercise price and tax withholding obligation has been made.

4. Exercise Upon Termination of Employment. If the Participant's employment with the Company and all subsidiaries terminates due to death, disability or retirement, the outstanding portion of the Option shall become fully vested on such date. The Option shall continue to be exercisable until (i) the Option's Expiration Date, in the case of termination due to disability or retirement or (ii) the earlier of the Option's Expiration Date or 12 months after the date of termination, in the case of termination due to death. In any case, the Participant's concurrent or subsequent termination of service on the Board shall have no effect on the Option.

In the event the Participant's employment with the Company and all subsidiaries terminates without cause (as determined by the Committee in its sole discretion) and for any reason other than death, disability or retirement, and the Participant's service on the Board continues thereafter, the Option shall continue to vest and remain exercisable in accordance with its terms. If the Participant's service on the Board subsequently terminates, then (i) if the termination of service is due to death, retirement or the Participant's conclusion that he is no longer able to serve due to a condition that meets the definition of disability below (provided the Board of Directors concurs that there is a disability), the outstanding portion of the Option shall become fully vested on such date and shall continue to be exercisable until the earlier of (A) the Expiration Date and (B) in the case of disability or retirement, 36 months after the date of termination of service, and in the case of death, 12 months after the date of termination of service, (ii) if the termination of service is without cause (as determined by the Committee in its sole discretion) and for any reason other than death, retirement or the Participant's conclusion that he is no longer able to serve due to a condition that meets the definition of disability below (provided the Board of Directors concurs that there is a disability), the Option shall expire on the earlier of the 90th day after the date of the Participant's termination or the date the Option expires by its terms and (iii) if the termination of service is for cause (as determined by the Committee in its sole discretion), the Option shall expire on the date of such termination of service, and no portion shall be exercisable after the date of such termination.

For purposes of this Section 4, (i) “disability” (A) while the Participant is employed, has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates, and (B) while the Participant is a Non-Employee Director, means (as determined by the Committee in its sole discretion) the inability of the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which is expected to result in death or disability or which has lasted or can be expected to last for a continuous period of not less than 12 months and (ii) “retirement” (A) while the Participant is employed, means the Participant's termination from employment with the Company and all

subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries, and (B) while the Participant is a Non-Employee Director, means termination of service on the Board when he is 72 or older.

The foregoing provisions of this Section 4 shall be subject to the provisions of any written employment or severance agreement that has been or may be executed by the Participant and the Company, and the provisions in such employment or severance agreement concerning exercise of the Option shall supersede any inconsistent or contrary provision of this Section 4.

5. Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) the then outstanding and unexercised portion of the Option (whether vested or unvested) shall be cancelled and forfeited back to the Company and (b) the Participant shall remit to the Company within 30 days of written notice from the Committee a cash payment equal to the number of shares of Common Stock subject to the portion of the Option that was previously exercised, multiplied by the excess of the fair market value of the Common Stock on the date of exercise over the Option Exercise Price. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

6. Nontransferability of Options. The Option may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution.

7. Beneficiary Designation. The Participant may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Option is to be paid in the event of his or her death. Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Board, and will be effective only when filed by the Participant in writing with the Board during his or her lifetime. In the absence of any such designation, or if all beneficiaries predecease the Participant, benefits remaining unpaid at the Participant's death shall be paid to the Participant's estate.

8. Rights as a Stockholder. The Participant shall have no rights as a stockholder of the Company with respect to the shares of Common Stock subject to the Option and this Agreement until such time as the exercise price has been paid and the shares have been issued and delivered to him or her.

9. Surrender of or Changes to Agreement. In the event the Option shall be exercised in whole, this Agreement shall be surrendered to the Company for cancellation. In the event the Option shall be exercised in part or a change in the number of designation of the shares of Common Stock shall be made, this Agreement shall be delivered by the Participant to the Company for the purpose of making appropriate notation thereon, or of otherwise reflecting, in such manner as the Company shall determine, the change in the number or designation of such shares.

10. Administration. The Option shall be exercised in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of, the Plan and this Agreement, all of which shall be binding upon the Participant.

11. Governing Law. This Agreement, and the Option, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EX-10.3

EXHIBIT 10.3

[Employees]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. [2012] Stock Plan

Restricted Stock Award Agreement

The employee identified below has been selected to be a Participant in the [Franklin Electric Co., Inc. Stock Plan] [Franklin Electric Co., Inc. 2012 Stock Plan] (the “Plan”), and has been granted a Restricted Stock Award (“Award”) as outlined below:

Participant:

Date of Award:

Number of Shares Subject to Award: *

End of Restriction Period:

* The number of shares subject to Award has been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Agreement, effective as of the Date of Award set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Award. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless specifically set forth otherwise herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1. Grant of Restricted Stock. Subject to the provisions set forth herein and the terms and conditions of the Plan, and in consideration of the agreements of the Participant herein provided, the Company hereby grants to the Participant the number of shares of Common Stock set forth above.

2. Acceptance by Participant. The receipt of the Award is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Award and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Option notification from EASi.

3. Transfer Restrictions. Except as set forth in Section 8.1 of the Plan, none of the shares of Common Stock subject to the Award (“Award Shares”) shall be sold, assigned, pledged or otherwise transferred, voluntarily or involuntarily, by the Participant (or his estate or personal representative, as the case may be), until such restrictions lapse in accordance with Sections 4 and 5 below.

4. Lapse of Restrictions. The restrictions set forth in Section 3 above shall lapse on the last day of the Restriction Period.

5. Death, Disability or Retirement. To the extent the restrictions set forth in Section 3 above have not lapsed in accordance with Section 4 above, in the event that the Participant's employment with the Company and all subsidiaries terminates due to the Participant's death, disability or retirement, such restrictions shall lapse with respect to a number of Award Shares determined by multiplying the number of Award Shares by a fraction, the numerator of which is the number of full months that have elapsed from the Date of Award to the termination of employment and the denominator of which is the number of full months in the Restriction Period. Award Shares with respect to which restrictions do not lapse shall be forfeited. For this purpose (a) “disability” has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates, and (b) “retirement” means the Participant's termination from employment with the Company and all subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries.

6. Forfeiture. The Award shall be forfeited to the Company upon the Participant's termination of employment with the Company and all subsidiaries for any reason other than the Participant's death, disability or retirement (as described in Section 5 above) that occurs prior to the date the restrictions lapse as provided in Section 4 above. The foregoing provisions of this Section 6 shall be subject to the provisions of any written employment or severance agreement that has been or may be executed by the Participant and the Company, and the provisions in such employment or severance agreement concerning the lapse of restrictions of an Award shall supersede any inconsistent or contrary provision of this Section 6.

7. Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) all outstanding Award Shares held by the Participant shall be forfeited by written notice from the Committee and (b) the Participant shall, within 30 days of receipt of such written notice from the Committee, remit to the Company either (i) a number of Award Shares pursuant to which the restrictions previously lapsed, or (ii) a cash payment equal to the number of Award Shares pursuant to which the restrictions described in Section 3 previously lapsed multiplied by the closing price of the Common Stock on the date the restrictions on such Award Shares lapsed. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

8. Withholding Taxes. If applicable, the Participant shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements prior to the delivery of any certificate for Award Shares. Payment of such taxes may be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted a notice and irrevocable instructions to deliver to the Company proceeds from the sale of a portion of the shares subject to the Award, (c) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value, and/or (d) by directing the Company to withhold such number of shares of Common Stock otherwise issuable in connection with the Award with a fair market value equal to the amount of tax to be withheld.

9. Rights as Shareholder. The Participant shall be entitled to all of the rights of a shareholder of the Company with respect to the outstanding Award Shares, including the right to vote such shares and to receive dividends and other distributions payable with respect to such Award Shares from the Award Date.

10. Escrow of Share Certificates. Certificates for the Award Shares shall be issued in the Participant's name and shall be held in escrow by the Company until all restrictions lapse or such Award Shares are forfeited or resold to the Company as provided herein. A certificate or certificates representing the Award Shares as to which restrictions have lapsed shall be delivered to the Participant (or the Participant's executor or personal representative in the case of the Participant's death) upon such lapse of restrictions.

11. Section 83(b) Election. The Participant may make an election pursuant to Section 83(b) of the Internal Revenue Code to recognize income with respect to the Award Shares before the restrictions lapse, by filing such election with the Internal Revenue Service within 30 days of the Award Date and providing a copy of that filing to the Company.

12. Administration. The Award shall be administered in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant.

13. Governing Law. This Agreement, and the Award, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EX-10.4

EXHIBIT 10.4

[Director Employee]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. 2012 Stock Plan

Restricted Stock Unit Award Agreement

The employee identified below has been selected to be a Participant in the Franklin Electric Co., Inc. 2012 Stock Plan (the “Plan”), and has been granted a Restricted Stock Unit (“RSU”) Award (“Award”) as outlined below:

Participant:

Date of Award:

Number of RSUs Subject to Award:*

End of Restriction Period:

* The number of RSUs subject to Award has been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was be paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Agreement, effective as of the Date of Award set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Award. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless specifically set forth otherwise herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1. Grant of RSUs. The Company hereby grants to the Participant the Award of RSUs. An RSU is the right, subject to the terms and conditions of the Plan and this Agreement, to receive a distribution of a share of Common Stock for each RSU as described in Section 7 of this Agreement.

2. Acceptance by Participant. The receipt of the Award is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Award and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Award notification from EASi.

3. RSU Account. The Company shall maintain an Account (“RSU Account”) on its books in the name of the Participant which shall reflect the number of RSUs awarded to the Participant.

4. Dividend Equivalents. Upon the payment of any dividend on Common Stock occurring during the period preceding the earlier of the date of vesting of the Participant's Award or the date the Participant's Award is forfeited as described in Sections 5 and 6, the Company shall promptly pay to the Participant an amount in cash equal in value to the dividends that the Participant would have received had the

Participant been the actual owner of the number of shares of Common Stock represented by the RSUs in the Participant's RSU Account on that date.

5. Vesting.

(a) Except as described in subsections (b), (c) and (d) below, the Participant shall become vested in his Award on the last day of the Restriction Period set forth above if he remains in continuous employment with the Company or a subsidiary until such date.

(b) If prior to the last day of the Restriction Period the Participant's employment with the Company and all subsidiaries terminates due to the Participant's death, disability or retirement, and the Participant's service on the Board does not continue thereafter, the Participant shall vest in a number of RSUs subject to the Award determined by multiplying the number of RSUs by a fraction, the numerator of which is the number of full months that have elapsed from the Date of Award to the termination of employment and the denominator of which is the number of full months in the Restriction Period.

(c) If prior to the last day of the Restriction Period the Participant's employment with the Company and all subsidiaries terminates for any reason and the Participant's service on the Board continues thereafter, the Participant shall continue to vest in his Award as described in subsection 5(a) as if he has continued in employment. If the Participant's service on the Board subsequently terminates, then, if the termination of service is for any reason other than for cause (as determined by the remaining Board members in their sole discretion), the Participant shall fully vest in his Award.

(d) Any RSUs that do not vest as described above upon the Participant's termination of employment and/or service on the Board shall be forfeited to the Company.

(e) For purposes of this Section 5, (i) “disability” (A) while the Participant is employed, has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates, and (B) while the Participant is a Non-Employee Director, means (as determined by the Committee in its sole discretion) the inability of the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which is expected to result in death or disability or which has lasted or can be expected to last for a continuous period of not less than 12 months; and (ii) “retirement” means the Participant's termination from employment with the Company and all subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries.

6. Forfeiture. The Award shall be forfeited to the Company upon the Participant's termination of employment with the Company and all subsidiaries, and service on the Board, for any reason other than as described in subsections 5(b) and (c) above that occurs prior to the last day of the Restriction Period. The foregoing provisions of this Section 6 shall be subject to the provisions of any written employment, severance or similar agreement that has been or may be executed by the Participant and the Company, and the provisions in such agreement concerning the vesting of the Award shall supersede any inconsistent or contrary provision of this Section 6.

7. Settlement of Award. To the extent the Participant becomes vested in his Award in accordance with Section 5, the Company shall distribute to him, or his personal representative, beneficiary or estate,

as applicable, a number of shares of Common Stock equal to the number of vested RSUs subject to the Award. Such shares shall be delivered within 30 days following the date of vesting.

8. Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) to the extent not vested, the Award shall be forfeited by written notice from the Committee and (b) to the extent the Award has vested, the Participant shall, within 30 days of receipt of such written notice from the Committee, remit to the Company either (i) a number of shares of Common Stock previously received in connection with the vesting of the Award (determined prior to any withholding of any applicable taxes), or (ii) a cash payment equal to the number of such shares previously received, multiplied by the closing price of the Common Stock on the date the Award vested. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

9. Withholding Taxes. If applicable, the Participant shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements prior to the delivery of any shares of Common Stock. Payment of such taxes may be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted a notice and irrevocable instructions to deliver to the Company proceeds from the sale of a portion of the shares subject to the Award, (c) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value, and/or (d) by directing the Company to withhold such number of shares of Common Stock otherwise issuable in connection with the Award with a fair market value equal to the amount of tax to be withheld.

10. Rights as Shareholder. The Participant shall not be entitled to any of the rights of a shareholder of the Company with respect to the Award, including the right to vote such shares and to receive dividends and any other distributions, until and to the extent the Award is settled in shares of Common Stock.

11. Share Delivery. Delivery of any shares in connection with settlement of the Award will be by book-entry credit to an account in the Participant's name established by the Company with the Company's transfer agent, or upon written request from the Participant (or his personal representative, beneficiary or estate, as the case may be) in certificates in the name of the Participant (or his personal representative, beneficiary or estate).

12. Award Not Transferable. The Award may not be transferred other than by will or the applicable laws of descent or distribution or pursuant to a qualified domestic relations order. The Award shall not otherwise be assigned, transferred, or pledged for any purpose whatsoever and is not subject, in whole or in part, to attachment, execution or levy of any kind. Any attempted assignment, transfer, pledge, or encumbrance of the Award, other than in accordance with its terms, shall be void and of no effect.

13. Administration.The Award shall be administered in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant.

14. Governing Law. This Agreement, and the Award, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EX-10.5

EXHIBIT 10.5

[Employee]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. 2012 Stock Plan

Restricted Stock Unit Award Agreement

The employee identified below has been selected to be a Participant in the Franklin Electric Co., Inc. 2012 Stock Plan (the “Plan”), and has been granted a Restricted Stock Unit (“RSU”) Award (“Award”) as outlined below:

Participant:

Date of Award:

Number of RSUs Subject to Award:*

End of Restriction Period:

* The number of RSUs subject to Award has been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Agreement, effective as of the Date of Award set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Award. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless specifically set forth otherwise herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1. Grant of RSUs. The Company hereby grants to the Participant the Award of RSUs. An RSU is the right, subject to the terms and conditions of the Plan and this Agreement, to receive a distribution of a share of Common Stock for each RSU as described in Section 7 of this Agreement.

2. Acceptance by Participant. The receipt of the Award is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Award and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Award notification from EASi.

3. RSU Account. The Company shall maintain an Account (“RSU Account”) on its books in the name of the Participant which shall reflect the number of RSUs awarded to the Participant.

4. Dividend Equivalents. Upon the payment of any dividend on Common Stock occurring during the period preceding the earlier of the date of vesting of the Participant's Award or the date the Participant's Award is forfeited as described in Sections 5 and 6, the Company shall promptly pay to the Participant an amount in cash equal in value to the dividends that the Participant would have received had the

Participant been the actual owner of the number of shares of Common Stock represented by the RSUs in the Participant's RSU Account on that date.

5. Vesting.

(a) Except as described in (b) and (c) below, the Participant shall become vested in his Award on the last day of the Restriction Period set forth above if he remains in continuous employment with the Company or a subsidiary until such date.

(b) If prior to the last day of the Restriction Period the Participant's employment with the Company and all subsidiaries terminates due to the Participant's death, disability or retirement, the Participant shall vest in a number of RSUs subject to the Award determined by multiplying the number of RSUs by a fraction, the numerator of which is the number of full months that have elapsed from the Date of Award to the termination of employment and the denominator of which is the number of full months in the Restriction Period. For this purpose, (i) “disability” has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates; and (ii) “retirement” means the Participant's termination from employment with the Company and all subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries.

(c) Any RSUs that do not vest as described above upon the Participant's termination of employment shall be forfeited to the Company.

6. Forfeiture. The Award shall be forfeited to the Company upon the Participant's termination of employment with the Company and all subsidiaries for any reason other than the Participant's death, disability or retirement (as described in Section 5 above) that occurs prior to the last day of the Restriction Period. The foregoing provisions of this Section 6 shall be subject to the provisions of any written employment, severance or similar agreement that has been or may be executed by the Participant and the Company, and the provisions in such agreement concerning the vesting of the Award shall supersede any inconsistent or contrary provision of this Section 6.

7. Settlement of Award. If the Participant becomes vested in his Award in accordance with Section 5, the Company shall distribute to him, or his personal representative, beneficiary or estate, as applicable, a number of shares of Common Stock equal to the number of vested RSUs subject to the Award. Such shares shall be delivered within 30 days following the date of vesting.

8. Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) to the extent not vested, the Award shall be forfeited by written notice from the Committee and (b) to the extent the Award has vested, the Participant shall, within 30 days of receipt of such written notice from the Committee, remit to the Company either (i) a number of shares of Common Stock previously received in connection with the vesting of the Award (determined prior to any withholding of any applicable taxes), or (ii) a cash payment equal to the number of such shares previously received, multiplied by the closing price of the Common Stock on the date the Award vested. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

9. Withholding Taxes. If applicable, the Participant shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements prior to the delivery of any shares of Common Stock. Payment of such taxes may be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted a notice and irrevocable instructions to deliver to the Company proceeds from the sale of a portion of the shares subject to the Award, (c) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value, and/or (d) by directing the Company to withhold such number of shares of Common Stock otherwise issuable in connection with the Award with a fair market value equal to the amount of tax to be withheld.

10. Rights as Shareholder. The Participant shall not be entitled to any of the rights of a shareholder of the Company with respect to the Award, including the right to vote such shares and to receive dividends and any other distributions, until and to the extent the Award is settled in shares of Common Stock.

11. Share Delivery. Delivery of any shares in connection with settlement of the Award will be by book-entry credit to an account in the Participant's name established by the Company with the Company's transfer agent, or upon written request from the Participant (or his personal representative, beneficiary or estate, as the case may be) in certificates in the name of the Participant (or his personal representative, beneficiary or estate).

12. Award Not Transferable. The Award may not be transferred other than by will or the applicable laws of descent or distribution or pursuant to a qualified domestic relations order. The Award shall not otherwise be assigned, transferred, or pledged for any purpose whatsoever and is not subject, in whole or in part, to attachment, execution or levy of any kind. Any attempted assignment, transfer, pledge, or encumbrance of the Award, other than in accordance with its terms, shall be void and of no effect.

13. Administration. The Award shall be administered in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant.

14. Governing Law. This Agreement, and the Award, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EX-10.6

EXHIBIT 10.6

[Employee]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. 2012 Stock Plan

Performance Stock Unit Award Agreement

The employee identified below has been selected to be a Participant in the Franklin Electric Co., Inc. 2012 Stock Plan (the “Plan”), and has been granted a Performance Stock Unit (“PSU”) Award (the “Award”) as outlined below:

Participant:

Date of Award:

Target Number of PSUs Subject to Award: *

End of Performance Period:

* The target number of PSUs subject to Award has been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Performance Stock Unit Award Agreement (this “Agreement”), effective as of the Date of Award set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Award. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless specifically set forth otherwise herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1. Grant of PSUs. The Company hereby grants to the Participant the Award of PSUs. A PSU is the right, subject to the terms and conditions of the Plan and this Agreement, to receive a distribution of a share of Common Stock for each PSU as described in Section 7 of this Agreement.

2. Acceptance by Participant. The receipt of the Award is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Award and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Award notification from EASi.

3. PSU Account. The Company shall maintain an Account (“PSU Account”) on its books in the name of the Participant which shall reflect the number of PSUs awarded to the Participant.

4. Dividend Equivalents. Upon the payment of any dividends on Common Stock occurring during the period preceding the date the PSUs are settled in Common Stock and distributed to the Participant as described in Section 7, the Company shall credit the Participant's PSU Account with an amount equal in value to the dividends that the Participant would have received had the Participant been the actual owner of the number of shares of Common Stock represented by the PSUs in the Participant's

PSU Account on that date. Such amounts shall be paid to the Participant in cash at the time and to the extent the PSUs are distributed to the Participant. Any dividend equivalents relating to PSUs that are forfeited shall also be forfeited.

5. Vesting.

(a) Except as described in (b), (c) and (d) below, the Participant shall become vested in his Award on the last day of the Performance Period if he remains in continuous employment with the Company or a subsidiary until such date.

(b) If prior to the last day of the Performance Period the Participant's employment with the Company and all subsidiaries terminates due to the Participant's death, disability or retirement, the Participant's Award shall remain outstanding and after the end of the Performance Period shall be adjusted as described in Section 7. The Participant shall vest in a number of PSUs subject to the Award as adjusted, determined by multiplying the number of adjusted PSUs by a fraction, the numerator of which is the number of full months that elapsed from the first day of the Performance Period to the date of termination of employment and the denominator of which is the number of full months in the Performance Period. For this purpose, (i) “disability” has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates, and (ii) “retirement” means the Participant's termination from employment with the Company and all subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries.

(c) If prior to the last day of the Performance Period there is a Change in Control of the Company, the Participant's Award shall immediately vest as of such date and shall not be subject to the adjustment described in Section 7.

(d) Any PSUs that do not vest as described above shall be forfeited to the Company.

6. Forfeiture. Any unvested Award shall be forfeited to the Company upon the Participant's termination of employment with the Company and all subsidiaries for any reason other than the Participant's death, disability or retirement (as described in Section 5 above) that occurs prior to the last day of the Performance Period. The foregoing provisions of this Section 6 shall be subject to the provisions of any written employment, severance or similar agreement that has been or may be executed by the Participant and the Company, and the provisions in such agreement concerning the vesting of the Award shall supersede any inconsistent or contrary provision of this Section 6.

7. Adjustment of PSUs. The number of PSUs subject to the Award as described in the Award letter shall be adjusted by the Committee after the end of the Performance Period based on the level of achievement of the previously established performance goal, as described on Exhibit A attached hereto. Any Award that vests in accordance with Section 5(c) prior to the last day of the Performance Period shall not be adjusted pursuant to this Section 7.

8. Settlement of Award. If the Participant becomes vested in his Award in accordance with Section 5, the Company shall distribute to him, or his personal representative, beneficiary or estate, as applicable, a number of shares of Common Stock equal to the number of vested PSUs subject to the Award, as adjusted in accordance with Section 7, if applicable. Such shares shall be delivered as soon as practicable after the Committee determines the level of achievement of the performance goal, but no

later than May 1 following the end of the Performance Period, or, in the case of an Award that vests in accordance with Section 5(c), within 30 days following the date of vesting.

9. Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) to the extent not vested, the Award shall be forfeited by written notice from the Committee and (b) to the extent the Award has vested, the Participant shall, within 30 days of receipt of such written notice from the Committee, remit to the Company either (i) a number of shares of Common Stock previously received in connection with the vesting of the Award (determined prior to any withholding of any applicable taxes), or (ii) a cash payment equal to the number of such shares previously received, multiplied by the closing price of the Common Stock on the date the Award vested. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

10. Withholding Taxes. If applicable, the Participant shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements prior to the delivery of any shares of Common Stock. Payment of such taxes may be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted a notice and irrevocable instructions to deliver to the Company proceeds from the sale of a portion of the shares subject to the Award, (c) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value, and/or (d) by directing the Company to withhold such number of shares of Common Stock otherwise issuable in connection with the Award with a fair market value equal to the amount of tax to be withheld.

11. Rights as Shareholder. The Participant shall not be entitled to any of the rights of a shareholder of the Company with respect to the Award, including the right to vote such shares and to receive dividends and any other distributions, until and to the extent the Award is settled in shares of Common Stock.

12. Share Delivery. Delivery of any shares in connection with settlement of the Award will be by book-entry credit to an account in the Participant's name established by the Company with the Company's transfer agent, or upon written request from the Participant (or his personal representative, beneficiary or estate, as the case may be) in certificates in the name of the Participant (or his personal representative, beneficiary or estate).

13. Award Not Transferable. The Award may not be transferred other than by will or the applicable laws of descent or distribution or pursuant to a qualified domestic relations order. The Award shall not otherwise be assigned, transferred, or pledged for any purpose whatsoever and is not subject, in whole or in part, to attachment, execution or levy of any kind. Any attempted assignment, transfer, pledge, or encumbrance of the Award, other than in accordance with its terms, shall be void and of no effect.

14. Administration.The Award shall be administered in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant.

15. Governing Law. This Agreement, and the Award, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EXHIBIT A

Franklin Electric Co., Inc. 2012 Stock Plan

Performance Stock Unit Agreement

2013 Performance Stock Unit Goal

After the end of the three-year Performance Period (January 2, 2016), the target number of PSUs subject to the Award will be multiplied by the Percentage Payout Factor set forth below, which is based on the Company's aggregate change in consolidated operating income (adjusted for non-recurring items as described in the Company's quarterly earnings releases) for the three-year Performance Period relative to the aggregate change in the three-year consolidated operating income reported by the companies in the S&P Small Cap 600® Industrials Index as of January 1, 2013 (adjusted for non-recurring items listed on the companies' income statements) for the Performance Period (or fiscal years ending in the Performance Period).

Performance Level	Aggregate Change in Operating Income Relative to Aggregate Change in Index Operating Income	Percentage Payout Factor
Below Threshold	<75%	—%
Threshold	75%	50%
Target	100%	100%
Maximum	125%	200%

Performance between threshold and target and target and maximum will be adjusted based on straight-line interpolation.

EX-10.7

EXHIBIT 10.7

[Director - Employee]

THIS DOCUMENT CONSTITUTES PART OF THE SECTION 10(a) PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

Franklin Electric Co., Inc. 2012 Stock Plan

Performance Stock Unit Award Agreement

The employee identified below has been selected to be a Participant in the Franklin Electric Co., Inc. 2012 Stock Plan (the “Plan”), and has been granted a Performance Stock Unit (“PSU”) Award (the “Award”) as outlined below:

Participant:

Date of Award:

Number of PSUs Subject to Award: *

End of Performance Period:

* The target number of PSUs subject to Award has been adjusted pursuant to Section 4.3 of the Plan to reflect the 2-for-1 stock dividend that was paid on March 18, 2013 to persons who held the Company's common stock as of March 4, 2013 (the record date).

________________________

This Performance Stock Unit Award Agreement (this “Agreement”), effective as of the Date of Award set forth above, is between Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and the Participant named above. The parties hereto agree as follows:

The Plan provides a complete description of the terms and conditions governing the Award. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan's terms shall govern. All capitalized terms shall have the meanings ascribed to them in the Plan, unless specifically set forth otherwise herein. A copy of the Plan is attached hereto and the terms of the Plan are hereby incorporated by reference.

1. Grant of PSUs. The Company hereby grants to the Participant the Award of PSUs. A PSU is the right, subject to the terms and conditions of the Plan and this Agreement, to receive a distribution of a share of Common Stock for each PSU as described in Section 7 of this Agreement.

2. Acceptance by Participant. The receipt of the Award is conditioned upon the acceptance of this Agreement by the Participant. The Participant must accept this Award and Agreement on the EASi website (www.easiadmin.com/sys/login.aspx) within 60 days after receipt of the Award notification from EASi.

3. PSU Account. The Company shall maintain an Account (“PSU Account”) on its books in the name of the Participant which shall reflect the number of PSUs awarded to the Participant.

4. Dividend Equivalents. Upon the payment of any dividends on Common Stock occurring during the period preceding the date the PSUs are settled in Common Stock and distributed to the Participant as described in Section 8, the Company shall credit the Participant's PSU Account with an amount equal in value to the dividends that the Participant would have received had the Participant been the actual owner of the number of shares of Common Stock represented by the PSUs in the Participant's

PSU Account on that date. Such amounts shall be paid to the Participant in cash at the time and to the extent the PSUs are distributed to the Participant. Any dividend equivalents relating to PSUs that are forfeited shall also be forfeited.

5. Vesting.

(a) Except as described below, the Participant shall become vested in his Award on the last day of the Performance Period if he remains in continuous employment with the Company or a subsidiary until such date.

(b) If prior to the last day of the Performance Period the Participant's employment with the Company and all subsidiaries terminates due to the Participant's death, disability or retirement, and the Participant's service on the Board does not continue thereafter, the Award shall remain outstanding and after the end of the Performance Period shall be adjusted as described in Section 7. The Participant shall vest in a number of PSUs subject to the Award as adjusted, determined by multiplying the number of adjusted PSUs by a fraction, the numerator of which is the number of full months that elapsed from the first day of the Performance Period to the date of termination of employment and the denominator of which is the number of full months in the Performance Period.

(c) If prior to the end of the Performance Period the Participant's employment with the Company and all subsidiaries terminates for any reason and the Participant's service on the Board continues thereafter, the Participant shall continue to vest in his Award as if he had continued in employment. If the Participant's service on the Board subsequently terminates prior to the end of the Performance Period for any reason other than for cause (as determined by the remaining Board members in their sole discretion), the Award shall adjust and vest as described in Section 5(b), with the numerator of the fraction including full months of employment with the Company and service on the Board.

(d) If prior to the last day of the Performance Period there is a Change in Control of the Company, the Participant's Award shall immediately vest as of such date and shall not be subject to the adjustment described in Section 7.

(e) Any PSUs that do not vest as described above upon the Participant's termination of employment or termination of service on the Board shall be forfeited to the Company.

(f) For purposes of this Section 5: (i) “disability” (A) while the Participant is employed, has the meaning, and will be determined, as set forth in the Company's long term disability program in which the Participant participates, and (B) while the Participant is a Non-Employee Director means the inability of the Participant to engage in any substantial mental impairment which is expected to result in death or disability or which has lasted or can be expected to last for a continuous period of not less than 12 months; and (ii) “retirement” means the Participant's termination from employment with the Company and all subsidiaries without cause (as determined by the Committee in its sole discretion) when the Participant is 65 or older or 55 or older with 10 years of service with the Company and its subsidiaries.

6. Forfeiture. The Award shall be forfeited to the Company upon the Participant's termination of employment with the Company and all subsidiaries for any reason other than the Participant's death, disability or retirement (as described in Section 5 above) that occurs prior to the last day of the

Performance Period. The foregoing provisions of this Section 6 shall be subject to the provisions of any written employment, severance or similar agreement that has been or may be executed by the Participant and the Company, and the provisions in such agreement concerning the vesting of the Award shall supersede any inconsistent or contrary provision of this Section 6.

7. Adjustment of PSUs. The number of PSUs subject to the Award as described in the Award letter shall be adjusted by the Committee after the end of the Performance Period based on the level of achievement of the previously established performance goal, as described on Exhibit A attached hereto. Any Award that vests in accordance with Section 5(d) prior to the end of the Performance Period shall not be adjusted pursuant to this Section 7.

8. Settlement of Award. If the Participant becomes vested in his Award in accordance with Section 5, the Company shall distribute to him, or his personal representative, beneficiary or estate, as applicable, a number of shares of Common Stock equal to the number of vested PSUs subject to the Award, as adjusted in accordance with Section 7, if applicable. Such shares shall be delivered as soon as practicable after the Committee determines the level of achievement of the performance goal, but no later than May 1 following the end of the Performance Period, or, in the case of an Award that vests in accordance with Section 5(d), within 30 days following the date of vesting.

9. Confidentiality and Non-Compete Agreement. Notwithstanding any other provision of this Agreement, in the event the Committee determines that the Participant has breached any provision of the Confidentiality and Non-Compete Agreement in effect between the Participant and the Company, (a) to the extent not vested, the Award shall be forfeited by written notice from the Committee and (b) to the extent the Award has vested, the Participant shall, within 30 days of receipt of such written notice from the Committee, remit to the Company either (i) a number of shares of Common Stock previously received in connection with the vesting of the Award (determined prior to any withholding of any applicable taxes), or (ii) a cash payment equal to the number of such shares previously received, multiplied by the closing price of the Common Stock on the date the Award vested. The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Participant.

10. Withholding Taxes. If applicable, the Participant shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements prior to the delivery of any shares of Common Stock. Payment of such taxes may be made by one or more of the following methods: (a) in cash, (b) in cash received from a broker-dealer to whom the Participant has submitted a notice and irrevocable instructions to deliver to the Company proceeds from the sale of a portion of the shares subject to the Award, (c) by delivery to the Company of other Common Stock owned by the Participant that is acceptable to the Company, valued at its then fair market value, and/or (d) by directing the Company to withhold such number of shares of Common Stock otherwise issuable in connection with the Award with a fair market value equal to the amount of tax to be withheld.

11. Rights as Shareholder. The Participant shall not be entitled to any of the rights of a shareholder of the Company with respect to the Award, including the right to vote such shares and to receive dividends and any other distributions, until and to the extent the Award is settled in shares of Common Stock.

12. Share Delivery. Delivery of any shares in connection with settlement of the Award will be by book-entry credit to an account in the Participant's name established by the Company with the Company's transfer agent, or upon written request from the Participant (or his personal representative, beneficiary

or estate, as the case may be) in certificates in the name of the Participant (or his personal representative, beneficiary or estate).

13. Award Not Transferable. The Award may not be transferred other than by will or the applicable laws of descent or distribution or pursuant to a qualified domestic relations order. The Award shall not otherwise be assigned, transferred, or pledged for any purpose whatsoever and is not subject, in whole or in part, to attachment, execution or levy of any kind. Any attempted assignment, transfer, pledge, or encumbrance of the Award, other than in accordance with its terms, shall be void and of no effect.

14. Administration.The Award shall be administered in accordance with such administrative regulations as the Committee shall from time to time adopt. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant.

15. Governing Law. This Agreement, and the Award, shall be construed, administered and governed in all respects under and by the laws of the State of Indiana.

* * *

By accepting this Agreement, the Participant agrees to be bound by the terms hereof.

EXHIBIT A

Franklin Electric Co., Inc. 2012 Stock Plan

Performance Stock Unit Agreement

2013 Performance Stock Unit Goal

After the end of the three-year Performance Period (January 2, 2016), the target number of PSUs subject to the Award will be multiplied by the Percentage Payout Factor set forth below, which is based on the Company's aggregate change in consolidated operating income (adjusted for non-recurring items as described in the Company's quarterly earnings releases) for the three-year Performance Period relative to the aggregate change in the three-year consolidated operating income reported by the companies in the S&P Small Cap 600® Industrials Index as of January 1, 2013 (adjusted for non-recurring items listed on the companies' income statements) for the Performance Period (or fiscal years ending in the Performance Period).

Performance Level	Aggregate Change in Operating Income Relative to Aggregate Change in Index Operating Income	Percentage Payout Factor
Below Threshold	<75%	—%
Threshold	75%	50%
Target	100%	100%
Maximum	125%	200%

Performance between threshold and target and target and maximum will be adjusted based on straight-line interpolation.

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, R. Scott Trumbull, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the first quarter ending March 30, 2013 of Franklin Electric Co., Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of Franklin Electric Co., Inc. as of, and for, the periods presented in this report;

4. Franklin Electric Co., Inc.'s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for Franklin Electric Co., Inc. and we have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Franklin Electric Co., Inc., including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of Franklin Electric Co., Inc.'s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any changes in Franklin Electric Co., Inc.'s internal control over financial reporting that occurred during Franklin Electric Co., Inc.'s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. Franklin Electric Co., Inc.'s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Franklin Electric Co., Inc.'s auditors and the audit committee of Franklin Electric Co., Inc.'s board of directors:

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Franklin Electric Co., Inc.'s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in Franklin Electric Co., Inc.'s internal control over financial reporting.

Date:	May 9, 2013
	/s/ R. Scott Trumbull
	R. Scott Trumbull
	Chairman and Chief Executive Officer
	Franklin Electric Co., Inc.

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, John J. Haines, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the first quarter ending March 30, 2013 of Franklin Electric Co., Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of Franklin Electric Co., Inc. as of, and for, the periods presented in this report;

4. Franklin Electric Co., Inc.'s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for Franklin Electric Co., Inc. and we have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Franklin Electric Co., Inc., including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of Franklin Electric Co., Inc.'s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in Franklin Electric Co., Inc.'s internal control over financial reporting that occurred during Franklin Electric Co., Inc.'s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, Franklin Electric Co., Inc.'s internal control over financial reporting; and

5. Franklin Electric Co., Inc.'s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Franklin Electric Co., Inc.'s auditors and the audit committee of Franklin Electric Co., Inc.'s board of directors:

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Franklin Electric Co., Inc.'s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in Franklin Electric Co., Inc.'s internal control over financial reporting.

Date:	May 9, 2013
	/s/ John J. Haines
	John J. Haines
	Vice President and Chief Financial Officer and Secretary
	Franklin Electric Co., Inc.

EX-32.1

EXHIBIT 32.1

CHIEF EXECUTIVE OFFICER CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Franklin Electric Co., Inc. (the “Company”) on Form 10-Q for the first quarter ending March 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, R. Scott Trumbull, Chairman and Chief Executive Officer of the Company, certify to my knowledge, pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350), that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 9, 2013
	/s/ R. Scott Trumbull
	R. Scott Trumbull
	Chairman and Chief Executive Officer
	Franklin Electric Co., Inc.

EX-32.2

EXHIBIT 32.2

CHIEF FINANCIAL OFFICER CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Franklin Electric Co., Inc. (the “Company”) on Form 10-Q for the first quarter ending March 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John J. Haines, Vice President and Chief Financial Officer and Secretary of the Company, certify to my knowledge, pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350), that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 9, 2013
	/s/ John J. Haines
	John J. Haines
	Vice President and Chief Financial Officer and Secretary
	Franklin Electric Co., Inc.

XML

STOCK SPLIT (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Dec. 29, 2012
Stock Split [Abstract]
Stock split conversion ratio	2
Common shares, par value (in dollars per share)	$ 0.10	$ 0.10
Value of stock issued during period as a result of stock split (in dollars)	$ 2.37
Stock issued during period as a result of stock split (in shares)	23.7
Stock split effected in the form of a stock distribution, distribution percentage	100.00%

XML

SHARE-BASED COMPENSATION (Details) (USD $)	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012	Mar. 30, 2013 Options	Mar. 30, 2013 Awards	Apr. 24, 2009 2009 Stock Plan [Member]	Apr. 24, 2009 2009 Stock Plan [Member] Options	Apr. 24, 2009 2009 Stock Plan [Member] Awards	May 04, 2012 2012 Stock Plan [Member]	May 04, 2012 2012 Stock Plan [Member] Options	May 04, 2012 2012 Stock Plan [Member] Employee Stock/Stock Unit Award [Member]
Share-based Compensation
Authorized Shares					4,400,000	3,200,000	1,200,000	2,400,000	1,680,000	720,000
Fair Value Assumptions
Risk-free interest rate (as a percent)	1.03%
Dividend yield (as a percent)	0.89%
Volatility factor (as a percent)	39.40%
Expected term (in years)	6.0 years
Forfeiture rate (as a percent)	4.52%
Stock Option Plans Activity and Related Information [Roll Forward]
Outstanding beginning of period, Shares	2,184,000	3,138,000
Outstanding beginning of period, Weighted-Average Exercise Price (in dollars per share)	$ 16.69	$ 14.83
Granted, Shares	176,168	0
Granted, Weighted-Average Exercise Price (in dollars per share)	$ 32.53	$ 0.00
Exercised, Shares	(307,000)	(194,000)
Exercised, Weighted-Average Exercise Price (in dollars per share)	$ 13.43	$ 13.46
Forfeited, Shares	0	(32,000)
Forfeited, Weighted-Average Exercise Price (in dollars per share)	$ 0.00	$ 24.44
Outstanding end of period, Shares	2,053,000	2,912,000
Outstanding end of period, Weighted-Average Exercise Price (in dollars per share)	$ 18.54	$ 14.94
Expected to vest after applying forfeiture rate, Shares	2,022,000	2,892,000
Expected to vest after applying forfeiture rate, Weighted-Average Exercise Price (in dollars per share)	$ 18.39	$ 14.95
Vested and exercisable end of period, Shares	1,457,000	2,356,000
Vested and exercisable end of period, Weighted-Average Exercise Price (in dollars per share)	$ 15.82	$ 15.18
Summary of Weighted Average Remaining Contractual Term and Aggregate Intrinsic Value
Outstanding end of period, weighted-average remaining contractual term (in years)	5 years 11 months 8 days
Outstanding end of period, aggregate intrinsic value	$ 30,874,000
Expected to vest after applying forfeiture rate, weighted-average remaining contractual term (in years)	5 years 10 months 20 days
Expected to vest after applying forfeiture rate, aggregate intrinsic value	30,691,000
Vested and exercisable end of period, weighted-average remaining contractual term (in years)	4 years 8 months 19 days
Vested and exercisable end of period, aggregate intrinsic value	25,861,000
Intrinsic value of options exercised (in dollars)	4,800,000	2,300,000
Total unrecognized compensation cost related to nonvested share-based compensation (in dollars)			2,600,000
Total unrecognized compensation cost, reconginzed over a weighted-average period (in years)			2 years 8 months 26 days	3 years 1 month 20 days
Total unrecognized compensation cost related to non-vested share-based compensation (in dollars)				$ 8,900,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward]
Nonvested at beginning of period, Shares	458,000	344,000
Nonvested at beginning of period, Weighted-Average Grant Date Fair Value (in dollars per share)	$ 20.90	$ 17.24
Awarded, Shares	141,000	8,000
Awarded, Weighted-Average Grant Data Fair Value (in dollars per share)	$ 32.53	$ 26.76
Vested, Shares	(35,000)	(4,000)
Vested, Weighted-Average Date Fair Value (in dollars per share)	$ 17.21	$ 16.10
Forfeited, Shares	(1,000)	(6,000)
Forfeited, Weighted-Average Grant Data Fair Value (in dollars per share)	$ 18.89	$ 18.35
Nonvested at end of period, Shares	563,000	342,000
Nonvested at the end of period, Weighted-Average Grant Date Fair Value (in dollars per share)	$ 24.04	$ 17.45

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DEBT (Details) (USD $)			3 Months Ended
	Mar. 30, 2013	Dec. 29, 2012	Mar. 30, 2013 Tax Increment Financing [Member]	Dec. 31, 2012 Tax Increment Financing [Member]	Mar. 30, 2013 Estimate of Fair Value, Fair Value Disclosure [Member]	Dec. 29, 2012 Estimate of Fair Value, Fair Value Disclosure [Member]
Debt
Prudential Agreement, fixed interest rate	5.79%
Principal borrowed				$ 25,000,000
Interest rate				3.60%
Cross default trigger			10.0
Prudential Agreement - 5.79 percent	150,000,000	150,000,000
Tax increment financing debt	25,000,000	0
Capital leases	900,000	1,000,000
Foreign subsidiary debt	14,900,000	14,900,000
Debt and capital lease oligations	190,800,000	165,900,000
Less current maturities	(15,945,000)	(15,176,000)
Long-term debt	174,854,000	150,729,000
Estimated fair value of long-term debt					$ 210,600,000	$ 179,800,000

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RESTRUCTURING (Details) (USD $)	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Restructuring Cost and Reserve
Restructuring (income)/expense	$ 710,000	$ (73,000)
Restructuring Reserve	600,000	0
Employee Severance [Member]
Restructuring Cost and Reserve
Restructuring (income)/expense	700,000
Water Systems | Employee Severance [Member]
Restructuring Cost and Reserve
Restructuring (income)/expense	500,000
Fueling Systems | Employee Severance [Member]
Restructuring Cost and Reserve
Restructuring (income)/expense	200,000
Other | Employee Severance [Member]
Restructuring Cost and Reserve
Restructuring (income)/expense	$ 0

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EMPLOYEE BENEFIT PLANS (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Net Periodic Benefit Cost
Defined benefit plan, contributions by employer	$ 1.6
Pension Benefits
Net Periodic Benefit Cost
Service cost	0.4	0.4
Interest cost	1.9	2.1
Expected return on assets	(2.5)	(2.6)
Prior service cost	0	0
Loss	0.9	0.5
Total net periodic benefit cost	0.7	0.4
Domestic Pension Plans
Net Periodic Benefit Cost and Other Benefit Cost
Defined Pension Plans, Number of pension plans	2
German Pension Plans
Net Periodic Benefit Cost and Other Benefit Cost
Defined Pension Plans, Number of pension plans	3
Other Benefits
Net Periodic Benefit Cost
Service cost	0	0
Interest cost	0.1	0.1
Expected return on assets	0	0
Prior service cost	0.1	0.1
Loss	0.1	0
Total net periodic benefit cost	$ 0.3	$ 0.2

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

3 Months Ended

Mar. 30, 2013

Stockholders' Equity Note [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) by component for the three months ended March 30, 2013 and March 31, 2012 are summarized below:

(In millions)
For the Three Months Ended March 30, 2013:	Foreign Currency Translation Adjustments			Pension and Post-Retirement Plan Benefit Adjustments				Total
Balance, December 29, 2012	$	(0.2	)	$	(56.9	)		$	(57.1	)
Other comprehensive income/(loss) before reclassifications:
Pre-tax income/(loss)	(5.8		)	—				(5.8		)
Income tax expense	—			—				—
Other comprehensive income/(loss) before reclassifications, net of income taxes	(5.8		)	—				(5.8		)
Amounts reclassified from accumulated other comprehensive income/(loss):
Pre-tax income	—			1.0			(1)	1.0
Income tax expense	—			(0.4		)		(0.4		)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	—			0.6				0.6
Net current period other comprehensive income/(loss), net of income taxes	(5.8		)	0.6				(5.2		)
Comprehensive loss attributable to noncontrolling interest	0.4			—				0.4
Balance, March 30, 2013	$	(5.6	)	$	(56.3	)		$	(61.9	)
For the Three Months Ended March 31, 2012:
Balance, December 31, 2011	$	(2.1	)	$	(47.2	)		$	(49.3	)
Other comprehensive income/(loss) before reclassifications:
Pre-tax income/(loss)	11.2			—				11.2
Income tax expense	—			—				—
Other comprehensive income/(loss) before reclassifications, net of income taxes	11.2			—				11.2
Amounts reclassified from accumulated other comprehensive income/(loss):
Pre-tax income	—			0.6			(1)	0.6
Income tax expense	—			(0.2		)		(0.2		)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	—			0.4				0.4
Net current period other comprehensive income/(loss), net of income taxes	11.2			0.4				11.6
Comprehensive loss attributable to noncontrolling interest	0.3			—				0.3
Balance, March 31, 2012	$	9.4		$	(46.8	)		$	(37.4	)

(1) This accumulated other comprehensive income (loss) component is included in the computation of net periodic pension cost (refer to Note 9 for additional details) and is included in the "Selling, general, and administrative expenses" line of the condensed consolidated statements of income.

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RESTRUCTURING

3 Months Ended

Mar. 30, 2013

Restructuring and Related Activities [Abstract]

RESTRUCTURING

RESTRUCTURING

Restructuring expenses for the first quarter of 2013 were approximately $0.7 million, and related to severance.

Costs incurred in the first quarter ended March 30, 2013, included in the “Restructuring expense” line of the Company's condensed consolidated statement of income, are as follows:

(In millions)	First Quarter Ended
	March 30, 2013
	Water Systems		Fueling Systems		Other		Consolidated
Employee severance	$	0.5	$	0.2	$	—	$	0.7

Restructuring expense of $(0.1) million was incurred in the first quarter ended March 31, 2012, which resulted from a gain on the sale of land the Company had previously held for development, but that was subsequently sold in the first quarter of 2012.

As of March 30, 2013, there was $0.6 million in restructuring reserves primarily for severance. As of March 31, 2012, there were no restructuring reserves.

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EARNINGS PER SHARE (Details) (USD $) Share data in Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Numerator:
Net income attributable to Franklin Electric Co., Inc. (in dollars)	$ 15,456,000	$ 23,046,000
Less: Undistributed earnings allocated to participating securities (in dollars)	200,000	0
Net income attributable to Franklin Electric Co., Inc. excluding undistributed earnings (in dollars)	$ 15,300,000	$ 23,000,000
Basic
Weighted average common shares (in shares)	47.3	46.8
Effect of dilutive securities:
Non-participating employee and director incentive stock options and performance awards (in shares)	0.7	1.0
Adjusted weighted average common shares (in shares)	48.0	47.8
Basic earnings per share (in dollars per share)	$ 0.32	$ 0.49
Diluted earnings per share (in dollars per share)	$ 0.32	$ 0.48
Stock Options
Effect of dilutive securities:
Anti-dilutive stock options (in shares)	0	0

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FAIR VALUE MEASUREMENTS (Narrative and Impo Contingent Consideration) (Details) (Impo Motor Pompa Sanayi ve Ticaret A.S.) In Millions, unless otherwise specified					3 Months Ended	12 Months Ended
	Dec. 29, 2012 USD ($)	Dec. 29, 2012 TRY	Jul. 02, 2011 USD ($)	Jul. 02, 2011 TRY	Mar. 30, 2013 Recurring Basis USD ($)	Dec. 29, 2012 Recurring Basis USD ($)	Mar. 30, 2013 Recurring Basis Significant Unobservable Inputs (Level 3) USD ($)	Dec. 29, 2012 Recurring Basis Significant Unobservable Inputs (Level 3) USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Impo contingent consideration	$ 5.6	10.0	$ 5.5	8.5	$ 0	$ 5.6	$ 0	$ 5.6
Accretion Expense					$ 0	$ 0.8

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RESTRUCTURING (Tables)

3 Months Ended

Mar. 30, 2013

Restructuring and Related Activities [Abstract]

Schedule of Restructuring Cost Incurred, Included in Restructuring Expense

Costs incurred in the first quarter ended March 30, 2013, included in the “Restructuring expense” line of the Company's condensed consolidated statement of income, are as follows:

(In millions)	First Quarter Ended
	March 30, 2013
	Water Systems		Fueling Systems		Other		Consolidated
Employee severance	$	0.5	$	0.2	$	—	$	0.7

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SEGMENT INFORMATION (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012	Dec. 29, 2012
Segment Reporting Information
Net sales to external customers	$ 222,524	$ 201,924
Operating income (loss)	23,166	20,998
Total assets	996,457		976,379
Water Systems
Segment Reporting Information
Net sales to external customers	176,400	165,000
Operating income (loss)	28,700	26,800
Total assets	713,000		692,000
Fueling Systems
Segment Reporting Information
Net sales to external customers	46,100	36,900
Operating income (loss)	6,200	5,600
Total assets	258,100		252,000
Other
Segment Reporting Information
Net sales to external customers	0	0
Operating income (loss)	(11,700)	(11,400)
Total assets	$ 25,400		$ 32,400

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INCOME TAXES Narrative (Details)	3 Months Ended
	Mar. 30, 2013
Income Tax Disclosure [Abstract]
United States statutory rate	35.00%

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ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Mar. 30, 2013

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

ACCOUNTING PRONOUCEMENTS

ACCOUNTING PRONOUNCEMENTS

In March 2013, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2013-02 Comprehensive Income. This guidance requires companies to disclose additional information about items reclassified out of accumulated other comprehensive income ("AOCI") either on the face of the income statement or as a separate footnote to the financial statements. In addition, changes in AOCI balance by component are to be presented. ASU 2013-02 is effective for both annual and interim periods for fiscal years beginning after December 15, 2012. The Company adopted ASU 2013-02 on a prospective basis, effective December 30, 2012. Refer to Note 14 for disclosures made. As the ASU addressed only disclosure requirements, adoption of ASU 2013-02 did not have a material impact on the Company's financial position, results of operations, or cash flows.

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OTHER ASSETS (Details) (USD $)	3 Months Ended					3 Months Ended		3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012	Mar. 06, 2012 Pioneer Pump Inc [Member]	Sep. 20, 2005 Pioneer Pump Inc [Member]	Mar. 06, 2012 Pioneer Pump Holdings Inc [Member]	Mar. 31, 2012 Pioneer Pump Holdings Inc [Member]	Mar. 07, 2012 Pioneer Pump Holdings Inc [Member]	Mar. 31, 2012 Other Income Expense [Member] Pioneer Pump Inc [Member]
Schedule of Equity Method Investments
Percent equity interest				35.00%	31.00%
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value							$ 23,900,000
Carrying value of the investment			11,700,000
Business Combination, Step Acquisition, Equity Interest in Acquiree, Remeasurement Gain	0	12,212,000				12,200,000
Proportionate share of earnings								$ 400,000
Loans receivable, maturity term (in years)	7 years
Business Acquisition, Percentage of Total Ownership							70.50%

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DEBT (Tables)

3 Months Ended

Mar. 30, 2013

Debt Disclosure [Abstract]

Schedule of Long-term Debt

Debt consisted of the following:

(In millions)	March 30, 2013			December 29, 2012
Prudential Agreement - 5.79 percent	$	150.0		$	150.0
Tax increment financing debt	25.0			—
Capital leases	0.9			1.0
Foreign subsidiary debt	14.9			14.9
	190.8			165.9
Less current maturities	(15.9		)	(15.2		)
Long-term debt	$	174.9		$	150.7

Schedule of Long-term Debt Payments

The following debt payments are expected to be paid in accordance with the following schedule:

(In millions)	Total		Year 1		Year 2		Year 3		Year 4		Year 5		More than 5 years
Debt	$	189.9	$	15.7	$	0.9	$	30.9	$	31.0	$	31.0	$	80.4
Capital leases	0.9		0.2		0.2		0.2		0.2		0.1		—
	$	190.8	$	15.9	$	1.1	$	31.1	$	31.2	$	31.1	$	80.4

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EMPLOYEE BENEFIT PLANS (Tables)

3 Months Ended

Mar. 30, 2013

Compensation and Retirement Disclosure [Abstract]

Schedule of Aggregated Net Periodic Benefit Cost and Other Benefit Cost

The following table sets forth the aggregated net periodic benefit cost for all pension plans for the first quarters ended March 30, 2013 and March 31, 2012, respectively:

(In millions)	Pension Benefits						Other Benefits
	First Quarter Ended						First Quarter Ended
	March 30, 2013			March 31, 2012			March 30, 2013		March 31, 2012
Service cost	$	0.4		$	0.4		$	—	$	—
Interest cost	1.9			2.1			0.1		0.1
Expected return on assets	(2.5		)	(2.6		)	—		—
Prior service cost	—			—			0.1		0.1
Loss	0.9			0.5			0.1		—
Total net periodic benefit cost	$	0.7		$	0.4		$	0.3	$	0.2

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INTANGIBLE ASSETS AND GOODWILL (Intangible Assets) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012	Dec. 29, 2012
Intangible Assets
Gross carrying amount, amortized intangibles	$ 147.9		$ 148.5
Accumulated amortization	(39.6)		(37.7)
Gross carrying amount, total intangibles	195.0		195.8
Amortization expense, intangible assets	2.0	1.5
Future Amortization Expense
2013	8.4
2014	8.4
2015	8.4
2016	8.3
2017	8.0
Patents
Intangible Assets
Gross carrying amount, amortized intangibles	7.8		7.8
Accumulated amortization	(5.7)		(5.7)
Supply Agreements
Intangible Assets
Gross carrying amount, amortized intangibles	4.4		4.4
Accumulated amortization	(4.4)		(4.4)
Technology
Intangible Assets
Gross carrying amount, amortized intangibles	7.5		7.5
Accumulated amortization	(3.4)		(3.2)
Customer Relationships
Intangible Assets
Gross carrying amount, amortized intangibles	125.3		125.9
Accumulated amortization	(24.8)		(23.1)
Software
Intangible Assets
Gross carrying amount, amortized intangibles	1.7		1.7
Accumulated amortization	(0.1)		(0.1)
Other
Intangible Assets
Gross carrying amount, amortized intangibles	1.2		1.2
Accumulated amortization	(1.2)		(1.2)
Trade Names
Intangible Assets
Gross carrying amount, unamortized intangibles	$ 47.1		$ 47.3

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EARNINGS PER SHARE (Tables)

3 Months Ended

Mar. 30, 2013

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share:

(In millions, except per share amounts)	First Quarter Ended
	March 30, 2013		March 31, 2012
Numerator:
Net income attributable to Franklin Electric Co., Inc.	$	15.5	$	23.0
Less: Undistributed earnings allocable to participating securities	0.2		—
	$	15.3	$	23.0
Denominator:
Basic
Weighted average common shares	47.3		46.8
Diluted
Effect of dilutive securities:
Non-participating employee and director incentive stock options and performance awards	0.7		1.0
Adjusted weighted average common shares	48.0		47.8
Basic earnings per share	$	0.32	$	0.49
Diluted earnings per share	$	0.32	$	0.48
Anti-dilutive stock options	—		—

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EQUITY ROLL FORWARD (Tables)

3 Months Ended

Mar. 30, 2013

Equity [Abstract]

Schedule of Stockholders' Equity

The schedule below sets forth equity changes in the three months ended March 30, 2013:

(In thousands)	Common Stock			Additional Paid in Capital		Retained Earnings			Minimum Pension Liability			Cumulative Translation Adjustment			Noncontrolling Interest		Total Equity			Redeemable Noncontrolling Interest
Balance as of December 29, 2012	$	4,712		$	170,890	$	395,950		$	(56,936	)	$	(210	)	$	2,580	$	516,986		$	5,263
Net income						15,456									209		15,665			(50		)
Dividends on common stock						(3,417		)									(3,417		)
Common stock issued	31			4,106		(9		)									4,128
Common stock repurchased or received for stock options exercised	(7		)			(2,499		)									(2,506		)
Share-based compensation	5			2,153													2,158
Tax benefit of stock options exercised				1,975													1,975
Currency translation adjustment												(5,351		)	197		(5,154		)	(635		)
Pension liability, net of taxes									590								590
Balance as of March 30, 2013	$	4,741		$	179,124	$	405,481		$	(56,346	)	$	(5,561	)	$	2,986	$	530,425		$	4,578

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CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

3 Months Ended

Mar. 30, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accompanying condensed consolidated balance sheet as of December 29, 2012, which has been derived from audited financial statements, and the unaudited interim condensed consolidated financial statements as of March 30, 2013, and for the first quarters ended March 30, 2013 and March 31, 2012, have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations.  In the opinion of management, all accounting entries and adjustments (including normal, recurring adjustments) considered necessary for a fair presentation of the financial position and the results of operations for the interim period have been made. Operating results for the first quarter ended March 30, 2013, are not necessarily indicative of the results that may be expected for the fiscal year ending December 28, 2013. For further information, including a description of the Company’s critical accounting policies, refer to the consolidated financial statements and notes thereto included in Franklin Electric Co., Inc.'s Annual Report on Form 10-K for the year ended December 29, 2012.

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EQUITY ROLL FORWARD (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	$ 516,986
Redeemable noncontrolling interest, beginning balance	5,263
Net income	15,615	23,161
Equity, ending balance	530,425
Redeemable noncontrolling interest, ending balance	4,578
Total Equity
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	516,986
Net income	15,665
Dividends on common stock	(3,417)
Common stock issued	4,128
Common stock repurchased or received for stock options exercised	(2,506)
Share-based compensation	2,158
Tax benefit of stock options exercised	1,975
Currency translation adjustment	(5,154)
Pension liability, net of taxes	590
Equity, ending balance	530,425
Common Stock
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	4,712
Common stock issued	31
Common stock repurchased or received for stock options exercised	(7)
Share-based compensation	5
Equity, ending balance	4,741
Additional Paid in Capital
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	170,890
Common stock issued	4,106
Share-based compensation	2,153
Tax benefit of stock options exercised	1,975
Equity, ending balance	179,124
Retained Earnings
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	395,950
Net income	15,456
Dividends on common stock	(3,417)
Common stock issued	(9)
Common stock repurchased or received for stock options exercised	(2,499)
Equity, ending balance	405,481
Minimum Pension Liability
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	(56,936)
Pension liability, net of taxes	590
Equity, ending balance	(56,346)
Cumulative Translation Adjustment
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	(210)
Currency translation adjustment	(5,351)
Equity, ending balance	(5,561)
Noncontrolling Interest
Increase (Decrease) in Stockholders' Equity
Equity, beginning balance	2,580
Net income	209
Currency translation adjustment	197
Equity, ending balance	2,986
Redeemable Noncontrolling Interest
Increase (Decrease) in Stockholders' Equity
Redeemable noncontrolling interest, beginning balance	5,263
Net income	(50)
Currency translation adjustment	(635)
Redeemable noncontrolling interest, ending balance	$ 4,578

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REDEEMABLE NONCONTROLLING INTERESTS (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012	Jul. 02, 2011	May 02, 2011 Impo Motor Pompa Sanayi ve Ticaret A.S.
Redeemable Noncontrolling Interest
Percentage of outstanding shares acquired				80.00%
Ownership percentage by noncontrolling owners				20.00%
Noncontrolling interest, description			three
Adjustment to recorded amount of redeemable noncontrolling interest	$ 0	$ 0

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CONTINGENCIES AND COMMITMENTS (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended			3 Months Ended			3 Months Ended
	Mar. 30, 2013	Mar. 30, 2013 South Coast Air Quality Management District	Dec. 01, 2010 South Coast Air Quality Management District	Mar. 30, 2013 Sacramento Metropolitan Air Quality Management District	Mar. 30, 2013 California Air Resources Board	Aug. 01, 2010 California Air Resources Board	Mar. 30, 2013 Dismissed [Member] StaRite Industries LLC and Pentair Inc
Loss Contingencies
Loss contingency, damages sought when case filed			$ 12.5			$ 25.0
Penalties sought		2.1		5.0	15.8		10.0
Commitments
Commitments for the purchase of machinery and equipment and building expansions	24.7
Changes in the Carrying Amount of the Warranty Accrual
Beginning balance	9.7
Accruals related to product warranties	1.8
Additions related to acquisitions	0
Reductions for payments made	(2.0)
Ending balance	$ 9.5

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Income Statement
Net sales	$ 222,524	$ 201,924
Cost of sales	148,583	135,652
Gross profit	73,941	66,272
Selling, general, and administrative expenses	50,065	45,347
Restructuring (income)/expense	710	(73)
Operating income	23,166	20,998
Interest expense	(2,590)	(2,588)
Other income	447	13,534
Foreign exchange income/(expense)	(171)	(298)
Income before income taxes	20,852	31,646
Income taxes	5,237	8,485
Net income	15,615	23,161
Less: Net income attributable to noncontrolling interests	(159)	(115)
Net income attributable to Franklin Electric Co., Inc.	$ 15,456	$ 23,046
Income per share:
Basic (in dollars per share)	$ 0.32	$ 0.49
Diluted (in dollars per share)	$ 0.32	$ 0.48
Dividends per common share (in dollars per share)	$ 0.07	$ 0.07

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INTANGIBLE ASSETS AND GOODWILL (Goodwill) (Details) (USD $)	3 Months Ended
	Mar. 30, 2013
Change in the Carrying Amount of Goodwill by Reporting Segment
Goodwill, beginning balance	$ 208,141,000
Acquisitions	0
Adjustments to prior year acquisitions	0
Foreign currency translation	(1,200,000)
Goodwill, ending balance	206,861,000
Water Systems
Change in the Carrying Amount of Goodwill by Reporting Segment
Goodwill, beginning balance	144,900,000
Acquisitions	0
Adjustments to prior year acquisitions	0
Foreign currency translation	(900,000)
Goodwill, ending balance	144,000,000
Fueling Systems
Change in the Carrying Amount of Goodwill by Reporting Segment
Goodwill, beginning balance	63,200,000
Acquisitions	0
Adjustments to prior year acquisitions	0
Foreign currency translation	(300,000)
Goodwill, ending balance	$ 62,900,000

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Cash flows from operating activities:
Net income	$ 15,615	$ 23,161
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization	7,367	6,158
Share-based compensation	2,158	982
Deferred income taxes	(2,623)	5,592
(Gain)/loss on disposals of plant and equipment	(1)	(322)
Gain on equity investment	0	(12,212)
Asset impairment	0	200
Foreign exchange expense	171	298
Excess tax from share-based payment arrangements	(2,063)	(731)
Changes in assets and liabilities, net of acquisitions:
Receivables	(28,686)	(25,395)
Inventory	(17,038)	(18,199)
Accounts payable and accrued expenses	(8,441)	(1,637)
Income taxes	2,459	(3,344)
Employee benefit plans	(1,485)	(693)
Other	1,788	(2,841)
Net cash flows from operating activities	(30,779)	(28,983)
Cash flows from investing activities:
Additions to property, plant, and equipment	(16,515)	(4,170)
Proceeds from sale of property, plant, and equipment	55	1,204
Additions to intangibles	48	0
Cash paid for acquisitions, net of cash acquired	0	(27,862)
Net cash flows from investing activities	(16,412)	(30,828)
Cash flows from financing activities:
Proceeds from issuance of debt	25,101	3,759
Repayment of debt	(85)	(1,739)
Proceeds from issuance of common stock	4,128	2,613
Excess tax from share-based payment arrangements	2,063	731
Purchases of common stock	(2,504)	(30)
Dividends paid	(3,417)	(3,152)
Payment of contingent consideration liability	(5,555)	0
Net cash flows from financing activities	19,731	2,182
Effect of exchange rate changes on cash	(1,212)	3,228
Net change in cash and equivalents	(28,672)	(54,401)
Cash and equivalents at beginning of period	103,338	153,337
Cash and equivalents at end of period	74,666	98,936
Cash paid for income taxes	4,430	6,245
Cash paid for interest, net of capitalized interest of $235 and $20, respectively	2,379	2,330
Non-cash items:
Additions to property, plant, and equipment, not yet paid	1,297	4
Pioneer Pump Holdings Inc [Member]
Non-cash items:
Payable to seller of acquired entities	0	1,698
Pioneer Pump Holdings, Inc. liability for mandatory share purchase	0	22,924
Impo Motor Pompa Sanayi ve Ticaret A.S.
Non-cash items:
Payable to seller of acquired entities	$ 0	$ 420

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CONTINGENCIES AND COMMITMENTS (Tables)

3 Months Ended

Mar. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

Schedule of Changes in the Carrying Amount of the Warranty Accrual

The changes in the carrying amount of the warranty accrual, as recorded in "Accrued expenses" in the Company's condensed consolidated balance sheet for the three months ended March 30, 2013, are as follows:

(In millions)
Beginning balance	$	9.7
Accruals related to product warranties	1.8
Additions related to acquisitions	—
Reductions for payments made	(2.0		)
Ending balance	$	9.5

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SEGMENT INFORMATION

3 Months Ended

Mar. 30, 2013

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

Financial information by reportable business segment is included in the following summary:

	First Quarter Ended				First Quarter Ended
(In millions)	March 30, 2013		March 31, 2012		March 30, 2013			March 31, 2012
	Net sales to external customers				Operating income (loss)
Water Systems	$	176.4	$	165.0	$	28.7		$	26.8
Fueling Systems	46.1		36.9		6.2			5.6
Other	—		—		(11.7		)	(11.4		)
Consolidated	$	222.5	$	201.9	$	23.2		$	21.0
	March 30, 2013		December 29, 2012
	Total assets
Water Systems	$	713.0	$	692.0
Fueling Systems	258.1		252.0
Other	25.4		32.4
Consolidated	$	996.5	$	976.4

Cash is the major asset group in “Other” of total assets.

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SHARE-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Authorized Number of Shares

he Franklin Electric Co., Inc. 2012 Stock Plan (the "2012 Stock Plan") is a stock-based compensation plan that provides for discretionary grants of stock options, stock awards, stock unit awards and performance awards to key employees and non-employee directors. Shares and per share data below have been adjusted for all periods presented to reflect the two-for-one stock split effective March 18, 2013.

The 2012 Stock Plan authorizes 2,400,000 shares for issuance as follows:

2012 Stock Plan	Authorized Shares
Stock Options	1,680,000
Stock/Stock Unit Awards	720,000

The Company also maintains the Amended and Restated Franklin Electric Co., Inc. Stock Plan (the “Stock Plan”) which, as amended in 2009, provided for discretionary grants of stock options and stock awards. The Stock Plan authorized 4,400,000 shares for issuance as follows:

Stock Plan	Authorized Shares
Stock Options	3,200,000
Stock Awards	1,200,000

Schedule of Assumptions Used to Determine the Fair Value of Options Granted

The assumptions used for the Black-Scholes model to determine the fair value of options granted during the first quarter ended March 30, 2013, are as follows:

	March 30, 2013
Risk-free interest rate	1.03	%
Dividend yield	0.89	%
Volatility factor	0.394
Expected term	6.0 years
Forfeiture rate	4.52	%

Schedule of Stock Option Plans Activity

A summary of the Company’s outstanding stock option activity and related information for the first quarters ended March 30, 2013 and March 31, 2012 is as follows:

(Shares in thousands)	March 30, 2013				March 31, 2012
Stock Options	Shares		Weighted-Average Exercise Price		Shares		Weighted-Average Exercise Price
Outstanding at beginning of period	2,184		$	16.69	3,138		$	14.83
Granted	176		32.53		—		—
Exercised	(307	)	13.43		(194	)	13.46
Forfeited	—		—		(32	)	24.44
Outstanding at end of period	2,053		$	18.54	2,912		$	14.94
Expected to vest after applying forfeiture rate	2,022		$	18.39	2,892		$	14.95
Vested and exercisable at end of period	1,457		$	15.82	2,356		$	15.18

Schedule of Stock Options, Contractual Term and Aggregate Intrinsic Value

A summary of the weighted average remaining contractual term and aggregate intrinsic value for the first quarter ended March 30, 2013 is as follows:

Stock Options	Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value (000's)
Outstanding end of period	5.94 years	$	30,874
Expected to vest after applying forfeiture rate	5.89 years	$	30,691
Vested and exercisable end of period	4.72 years	$	25,861

Schedule of Restricted Stock/Stock Unit Award Activity

A summary of the Company’s restricted stock/stock unit award activity and related information for the first quarters ended March 30, 2013 and March 31, 2012 is as follows:

(Shares in thousands)	March 30, 2013				March 31, 2012
Stock/Stock Unit Awards	Shares		Weighted-Average Grant- Date Fair Value		Shares		Weighted-Average Grant-Date Fair Value
Non-vested at beginning of period	458		$	20.90	344		$	17.24
Awarded	141		32.53		8		26.76
Vested	(35	)	17.21		(4	)	16.10
Forfeited	(1	)	18.89		(6	)	18.35
Non-vested at end of period	563		$	24.04	342		$	17.46

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SHARE-BASED COMPENSATION

3 Months Ended

Mar. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

The Franklin Electric Co., Inc. 2012 Stock Plan (the "2012 Stock Plan") is a stock-based compensation plan that provides for discretionary grants of stock options, stock awards, stock unit awards and performance awards to key employees and non-employee directors. Shares and per share data below have been adjusted for all periods presented to reflect the two-for-one stock split effective March 18, 2013.

The 2012 Stock Plan authorizes 2,400,000 shares for issuance as follows:

2012 Stock Plan	Authorized Shares
Stock Options	1,680,000
Stock/Stock Unit Awards	720,000

The Company also maintains the Amended and Restated Franklin Electric Co., Inc. Stock Plan (the “Stock Plan”) which, as amended in 2009, provided for discretionary grants of stock options and stock awards. The Stock Plan authorized 4,400,000 shares for issuance as follows:

Stock Plan	Authorized Shares
Stock Options	3,200,000
Stock Awards	1,200,000

All options in the Stock Plan have been awarded. The Company currently issues new shares from its common stock balance to satisfy option exercises and stock and stock unit awards under the Stock Plan. The Company currently issues options, restricted stock/stock unit and performance awards under the 2012 Stock Plan.

Stock Options:

The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model with a single approach and amortized using a straight-line attribution method over the option’s vesting period.  

The assumptions used for the Black-Scholes model to determine the fair value of options granted during the first quarter ended March 30, 2013, are as follows:

	March 30, 2013
Risk-free interest rate	1.03	%
Dividend yield	0.89	%
Volatility factor	0.394
Expected term	6.0 years
Forfeiture rate	4.52	%

There were 176,168 stock options granted during the first quarter ended March 30, 2013. There were no stock options granted during the first quarter ended March 31, 2012.

A summary of the Company’s outstanding stock option activity and related information for the first quarters ended March 30, 2013 and March 31, 2012 is as follows:

(Shares in thousands)	March 30, 2013				March 31, 2012
Stock Options	Shares		Weighted-Average Exercise Price		Shares		Weighted-Average Exercise Price
Outstanding at beginning of period	2,184		$	16.69	3,138		$	14.83
Granted	176		32.53		—		—
Exercised	(307	)	13.43		(194	)	13.46
Forfeited	—		—		(32	)	24.44
Outstanding at end of period	2,053		$	18.54	2,912		$	14.94
Expected to vest after applying forfeiture rate	2,022		$	18.39	2,892		$	14.95
Vested and exercisable at end of period	1,457		$	15.82	2,356		$	15.18

A summary of the weighted average remaining contractual term and aggregate intrinsic value for the first quarter ended March 30, 2013 is as follows:

Stock Options	Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value (000's)
Outstanding end of period	5.94 years	$	30,874
Expected to vest after applying forfeiture rate	5.89 years	$	30,691
Vested and exercisable end of period	4.72 years	$	25,861

The total intrinsic value of options exercised during the first quarter ended March 30, 2013 and March 31, 2012, was $4.8 million and $2.3 million, respectively.

As of March 30, 2013, there was $2.6 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the 2012 Stock Plan and the Stock Plan related to stock options.  That cost is expected to be recognized over a weighted-average period of 2.74 years.

Stock/Stock Unit Awards:

A summary of the Company’s restricted stock/stock unit award activity and related information for the first quarters ended March 30, 2013 and March 31, 2012 is as follows:

(Shares in thousands)	March 30, 2013				March 31, 2012
Stock/Stock Unit Awards	Shares		Weighted-Average Grant- Date Fair Value		Shares		Weighted-Average Grant-Date Fair Value
Non-vested at beginning of period	458		$	20.90	344		$	17.24
Awarded	141		32.53		8		26.76
Vested	(35	)	17.21		(4	)	16.10
Forfeited	(1	)	18.89		(6	)	18.35
Non-vested at end of period	563		$	24.04	342		$	17.46

As of March 30, 2013, there was $8.9 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the 2012 Stock Plan and Stock Plan related to stock awards.  That cost is expected to be recognized over a weighted-average period of 3.14 years.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Parenthetical (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Capitalized interest	$ 235	$ 20

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 30, 2013	Mar. 31, 2012
Net income	$ 15,615	$ 23,161
Other comprehensive income/(loss), before tax:
Foreign currency translation adjustments	(5,789)	11,214
Employee benefit plan activity	970	587
Other comprehensive income/(loss)	(4,819)	11,801
Income tax related to items of other comprehensive income	(380)	(230)
Other comprehensive income/(loss), net of tax	(5,199)	11,571
Comprehensive income	10,416	34,732
Comprehensive loss attributable to noncontrolling interest	279	163
Comprehensive income attributable to Franklin Electric Co., Inc	$ 10,695	$ 34,895

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INCOME TAXES

3 Months Ended

Mar. 30, 2013

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The effective tax rate continues to be lower than the United States statutory rate of 35 percent primarily due to the indefinite reinvestment of foreign earnings taxed at rates below the U.S. statutory rate as well as recognition of foreign tax credits.  The Company has the ability to indefinitely reinvest these foreign earnings based on the earnings and cash projections of its other operations as well as cash on hand and available credit.

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DOCUMENT AND ENTITY INFORMATION	3 Months Ended
	Mar. 30, 2013	Apr. 30, 2013
Document Information
Entity Registrant Name	FRANKLIN ELECTRIC CO INC
Entity Central Index Key	0000038725
Current Fiscal Year End Date	--12-28
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Mar. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		47,416,920

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DEBT

3 Months Ended

Mar. 30, 2013

Debt Disclosure [Abstract]

DEBT

DEBT

Debt consisted of the following:

(In millions)	March 30, 2013			December 29, 2012
Prudential Agreement - 5.79 percent	$	150.0		$	150.0
Tax increment financing debt	25.0			—
Capital leases	0.9			1.0
Foreign subsidiary debt	14.9			14.9
	190.8			165.9
Less current maturities	(15.9		)	(15.2		)
Long-term debt	$	174.9		$	150.7

On December 31, 2012, the Company, Allen County, Indiana and certain institutional investors entered into a Bond Purchase and Loan Agreement. Under the agreement, Allen County, Indiana issued a series of Project Bonds entitled “Taxable Economic Development Bonds, Series 2012 (Franklin Electric Co., Inc. Project).” The aggregate principal amount of the Project Bonds that were issued, authenticated, and are now outstanding thereunder was limited to $25.0 million. The Company then borrowed the proceeds under the Project Bonds through the issuance of Project Notes to finance the cost of acquisition, construction, installation and equipping of the new Global Corporate Headquarters and Engineering Center of Excellence. These Project Notes (tax increment financing debt) bear interest at 3.6 percent per annum. Interest and principal balance of the Project Notes are due and payable by the Company directly to the institutional investors in aggregate semi-annual installments commencing on July 10, 2013, and concluding on January 10, 2033. The use of the proceeds from the Project Notes is limited to assist the financing of the new Global Corporate Headquarters and Engineering Center of Excellence.

The tax increment financing debt contains customary affirmative and negative covenants. The affirmative covenants include financial statements, notices of material events, conduct of business, inspection of property, maintenance of insurance, compliance with laws and most favored lender obligations. The negative covenants include limitations on loans or advances, investments, and the granting of liens by the Company or its subsidiaries, as well as prohibitions on certain consolidations, mergers, sales and transfers of assets. The covenants also include financial requirements including a maximum leverage ratio and a minimum interest coverage ratio. Cross default is applicable with tax increment financing debt, but only if the Company is defaulting on an obligation exceeding $10.0 million.

Also, on December 31, 2012, the Company and Prudential Insurance Company of America entered into an amendment to the Second Amended and Restated Note Purchase and Private Shelf Agreement to extend the effective date to December 31, 2015.

Foreign subsidiary debt denoted in the table above is predominately comprised of debt at Impo.

The total estimated fair value of debt was $210.6 million and $179.8 million at March 30, 2013 and December 29, 2012, respectively. The fair value assumed floating rate debt was valued at par. In the absence of quoted prices in active markets considerable judgment is required in developing estimates of fair value. Estimates are not necessarily indicative of the amounts the Company could realize in a current market transaction. In determining the fair value of its long-term debt the Company uses estimates based on rates currently available to the Company for debt with similar terms and remaining maturities. Accordingly, the fair value of debt is classified as a Level 2 within the valuations hierarchy.

The following debt payments are expected to be paid in accordance with the following schedule:

(In millions)	Total		Year 1		Year 2		Year 3		Year 4		Year 5		More than 5 years
Debt	$	189.9	$	15.7	$	0.9	$	30.9	$	31.0	$	31.0	$	80.4
Capital leases	0.9		0.2		0.2		0.2		0.2		0.1		—
	$	190.8	$	15.9	$	1.1	$	31.1	$	31.2	$	31.1	$	80.4

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Mar. 30, 2013	Dec. 29, 2012
Current assets:
Cash and cash equivalents	$ 74,666	$ 103,338
Receivables, less allowances of $3,269 and $3,148, respectively	130,884	102,918
Inventories:
Raw material	77,695	72,536
Work-in-process	18,223	18,295
Finished goods	109,440	101,017
Total inventories	205,358	191,848
Deferred income taxes	11,386	7,912
Other current assets	21,886	22,901
Total current assets	444,180	428,917
Property, plant and equipment, at cost:
Land and buildings	90,276	90,616
Machinery and equipment	206,176	204,408
Furniture and fixtures	26,740	26,887
Other	43,699	33,500
Property, plant, and equipment, gross	366,891	355,411
Less: Allowance for depreciation	(185,898)	(183,436)
Property, plant, and equipment, net	180,993	171,975
Deferred income tax	2,658	2,540
Intangible assets, net	155,393	158,117
Goodwill	206,861	208,141
Other assets	6,372	6,689
Total assets	996,457	976,379
Current liabilities:
Accounts payable	63,978	68,660
Deferred tax liability	1,173	1,173
Accrued expenses	47,987	60,415
Income taxes	713	215
Current maturities of long-term debt and short-term borrowings	15,945	15,176
Total current liabilities	129,796	145,639
Long-term debt	174,854	150,729
Deferred income taxes	41,329	40,136
Employee benefit plans	76,144	78,967
Other long-term liabilities	39,331	38,659
Commitments and contingencies (see Note 16)	0	0
Redeemable noncontrolling interest	4,578	5,263
Shareowners' equity:
Common stock (65,000 shares authorized, $.10 par value) outstanding (47,412 and 47,132, respectively)	4,741	4,712
Additional capital	179,124	170,890
Retained earnings	405,481	395,950
Accumulated other comprehensive loss	(61,907)	(57,146)
Total shareowners' equity	527,439	514,406
Noncontrolling interest	2,986	2,580
Total equity	530,425	516,986
Total liabilities and equity	$ 996,457	$ 976,379

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REDEEMABLE NONCONTROLLING INTERESTS

3 Months Ended

Mar. 30, 2013

Noncontrolling Interest [Abstract]

REDEEMABLE NONCONTROLLING INTERESTS

REDEEMABLE NONCONTROLLING INTERESTS

On May 2, 2011, the Company completed the acquisition of 80 percent of Impo Motor Pompa Sanayi ve Ticaret A.S. ("Impo"). The 20 percent noncontrolling interest was recorded at fair value as of the acquisition date. The noncontrolling interest holders have the option, which is embedded in the noncontrolling interest, to require the Company to redeem their ownership interests after May 2, 2014, three years after the original agreement was signed. The combination of a noncontrolling interest and a redemption feature resulted in a redeemable noncontrolling interest.

The noncontrolling interest in Impo is redeemable at other than fair value as the redemption value is determined based on a specified formula.  The noncontrolling interest becomes redeemable after the passage of time and, therefore, the Company records the carrying amount of the noncontrolling interest at the greater of (1) the initial carrying amount, increased or decreased for each noncontrolling interest's share of net income or loss and its share of other comprehensive income or loss and dividends (“carrying amount”) or (2) the redemption value which is determined based on the greater of the redemption floor value or the then-current specified earnings multiple.  As of March 30, 2013, the Impo redeemable noncontrolling interest was recorded at the carrying amount.

According to FASB ASC Topic 810, Consolidation and Emerging Issues Task Force ("EITF") Topic No. D-98, Classification and Measurement of Redeemable Securities, for redeemable noncontrolling interests issued in the form of common securities, to the extent that the noncontrolling interest holder has a contractual right to receive an amount upon share redemption that is other than the fair value of such shares, the noncontrolling interest holder has, in substance, received a dividend distribution that is different from other common shareholders. Therefore, adjustments to the noncontrolling interest to reflect the redemption amount should be reflected in the computation of earnings per share using the two-class method. Under the two-class method, the Company has elected to treat as a dividend only the portion of the periodic redemption value adjustment (if any) that reflects a redemption value in excess of fair value.  No adjustments were necessary for the first quarters ended March 30, 2013 or March 31, 2012.

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STOCK SPLIT

3 Months Ended

Mar. 30, 2013

Stock Split [Abstract]

STOCK SPLIT

STOCK SPLIT

On February 22, 2013, the Company announced that its Board of Directors declared a two-for-one stock split of the Company's common stock in the form of a 100 percent stock distribution. The stock distribution was distributed or paid on March 18, 2013, to stockholders of record as of March 4, 2013. As a result of this action, approximately 23.7 million shares were issued to stockholders of record as of March 4, 2013. The par value of the common stock remains at $0.10 per share and, accordingly, approximately $2.37 million was transferred from retained earnings to common stock. Earnings and dividends declared per share and weighted average shares outstanding are presented in this Form 10-Q after the effect of the 100 percent stock distribution. The two-for-one stock split is reflected in the share and per share amounts in all periods presented in this Form 10-Q.

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CONTINGENCIES AND COMMITMENTS

3 Months Ended

Mar. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCIES AND COMMITMENTS

CONTINGENCIES AND COMMITMENTS

In August 2010, the California Air Resources Board (“CARB”) filed a civil complaint in the Los Angeles Superior Court against the Company and Franklin Fueling Systems, Inc. (a wholly-owned subsidiary of the Company).  The complaint relates to a third-party-supplied component part of the Company's Healy 900 Series nozzle, which is part of the Company's Enhanced Vapor Recovery (“EVR”) Systems installed in California gasoline filling stations.  This part, a diaphragm, was the subject of a retrofit during the first half of 2008.  As the Company previously reported, in October 2008 CARB issued a Notice of Violation to the Company alleging that the circumstances leading to the retrofit program violated California statutes and regulations.  The Company and CARB worked to resolve the diaphragm matter without court action, but were unable to reach agreement.

The claims in the complaintmirror those that CARB presented to the Company in the Notice of Violation, and include claims that the Company negligently and intentionally sold nozzles with a modified diaphragm without required CARB certification.  The Company believes that, throughout the period to which the complaint relates, it acted in full cooperation with CARB and in the best interests of CARB's vapor emissions control program.  Although the complaint seeks penalties of at least $25.0 million, it is the Company's position that there is no reasonable basis for penalties of this amount.

In addition, as the Company has previously reported, the Sacramento Metropolitan Air Quality Management District (“SMAQMD”) issued a Notice of Violation to the Company concerning the diaphragm matter in March 2008.  Discussions with that agency about the circumstances leading to the retrofit in its jurisdiction and the resolution of the agency's concerns did not result in agreement, and in November 2010 SMAQMD filed a civil complaint in the Sacramento Superior Court, mirroring the claims brought by CARB with respect to the diaphragm issue and also alleging violation of SMAQMD rules.  SMAQMD's suit asks for at least $5.0 million in penalties for the violations claimed in its jurisdiction.

In July 2010, the Company entered into a tolling agreement with the South Coast Air Quality Management District (“SCAQMD”) and began discussions with that agency about the circumstances leading to the retrofit in its jurisdiction and the resolution of the agency's concerns.  Those discussions did not result in agreement and in December 2010, SCAQMD filed a civil complaint against the Company in Los Angeles Superior Court.  The complaint alleges violations of California statutes and regulations, similar to the complaint filed by CARB, as well as violation of SCAQMD rules, and seeks penalties of at least $12.5 million.  The SCAQMD complaint does not allege an intentional violation of any statute, rule, or regulation. This case was consolidated with the CARB case in Los Angeles Superior Court.

The Company believes that there is no reasonable basis for the amount of penalties claimed in the SMAQMD and SCAQMD suits.  The Company answered the SMAQMD and SCAQMD complaints, as well as the CARB complaint, denying liability and asserting affirmative defenses. The consolidated CARB/SCAQMD cases were tried to the Court in the latter part of December 2012 through early January 2013. In their respective post-trial briefs, CARB requested a civil penalty award of approximately $15.8 million and SCAQMD requested a civil penalty award of approximately $2.1 million. The SMAQMD case is set for trial beginning May 20, 2013. Penalties awarded in the CARB or any air district proceedings or payments resulting from a settlement of these matters, depending on the amount, could have a material adverse effect on the Company's financial position, results of operations, and net cash flows.

None of these suits have any effect on CARB's certification of the Company's EVR System or any other products of the Company or its subsidiaries, and so do not interfere with continuing sales.  CARB has never decertified the Company's EVR System and does not propose to do so now. 

On April 1, 2013, the U.S. court of Appeals for the Sixth Circuit affirmed judgment as a matter of law for the Company, dismissing claims brought in July 2009, by Sta-Rite Industries, LLC and Pentair, Inc. Those claims originally were brought against the Company in the U.S. District Court for the Northern District of Ohio, alleging breach of the parties' 2004 Settlement Agreement and tortious interference with contract based on the Company's pricing of submersible electric products, and sought damages in excess of $10.0 million for each claimant. The Company denied liability, defended the case vigorously, and filed a counterclaim alleging Sta-rite and Pentair's breach of the same Settlement Agreement. Both the Company and Sta-Rite/Pentair filed Motions for Summary Judgment in February 2011. The district judge granted the Company's motion and dismissed Sta-Rite/Pentair's claims against it in September 2011. The judge also granted Sta-Rite/Pentair's motion for Summary Judgment and dismissed the Company's counterclaim. Sta-rite/Pentair appealed the dismissal of its claims. The April 1, 2013 affirmance by the Court of Appeals terminates the appeal and the litigation, unless Sta-Rite/Pentair petition for appeal to the U.S. Supreme Court.

The Company is defending various other claims and legal actions, including environmental matters, which have arisen in the ordinary course of business. In the opinion of management, based on current knowledge of the facts and after discussion with counsel, these claims and legal actions can be successfully defended or resolved without a material adverse effect on the Company’s financial position, results of operations, and net cash flows.

At March 30, 2013, the Company had $24.7 million of commitments primarily for the purchase of machinery and equipment as well as conditional agreements related to building expansions.

The Company provides warranties on most of its products. The warranty terms vary but are generally two years from date of manufacture or one year from date of installation. In 2007, the Company began offering an extended warranty program to certain Water Systems customers which provides warranty coverage up to five years from the date of manufacture. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. The Company actively studies trends of warranty claims and takes action to improve product quality and minimize warranty claims. The Company believes that the warranty reserve is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the reserve.

The changes in the carrying amount of the warranty accrual, as recorded in "Accrued expenses" in the Company's condensed consolidated balance sheet for the three months ended March 30, 2013, are as follows:

(In millions)
Beginning balance	$	9.7
Accruals related to product warranties	1.8
Additions related to acquisitions	—
Reductions for payments made	(2.0		)
Ending balance	$	9.5

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EARNINGS PER SHARE

3 Months Ended

Mar. 30, 2013

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

The Company calculates basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. The Company's participating securities consist of share-based payment awards that contain a nonforfeitable right to receive dividends and therefore are considered to participate in undistributed earnings with common shareholders.

Basic earnings per common share excludes dilution and is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares as of the balance sheet date, as adjusted for the potential dilutive effect of non-participating share-based awards.

The following table sets forth the computation of basic and diluted earnings per share:

(In millions, except per share amounts)	First Quarter Ended
	March 30, 2013		March 31, 2012
Numerator:
Net income attributable to Franklin Electric Co., Inc.	$	15.5	$	23.0
Less: Undistributed earnings allocable to participating securities	0.2		—
	$	15.3	$	23.0
Denominator:
Basic
Weighted average common shares	47.3		46.8
Diluted
Effect of dilutive securities:
Non-participating employee and director incentive stock options and performance awards	0.7		1.0
Adjusted weighted average common shares	48.0		47.8
Basic earnings per share	$	0.32	$	0.49
Diluted earnings per share	$	0.32	$	0.48
Anti-dilutive stock options	—		—

Shares and per share data have been adjusted for all periods presented to reflect a two-for-one stock split effective March 18, 2013.

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INTANGIBLE ASSETS AND GOODWILL

3 Months Ended

Mar. 30, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS AND GOODWILL

INTANGIBLE ASSETS AND GOODWILL

The carrying amounts of the Company’s intangible assets are as follows:

(In millions)	March 30, 2013					December 29, 2012
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangibles:
Patents	$	7.8	$	(5.7	)	$	7.8	$	(5.7	)
Supply agreements	4.4		(4.4		)	4.4		(4.4		)
Technology	7.5		(3.4		)	7.5		(3.2		)
Customer relationships	125.3		(24.8		)	125.9		(23.1		)
Software	1.7		(0.1		)	1.7		(0.1		)
Other	1.2		(1.2		)	1.2		(1.2		)
Total	$	147.9	$	(39.6	)	$	148.5	$	(37.7	)
Unamortized intangibles:
Trade names	47.1		—			47.3		—
Total intangibles	$	195.0	$	(39.6	)	$	195.8	$	(37.7	)

Amortization expense related to intangible assets for the first quarters ended March 30, 2013 and March 31, 2012, was $2.0 million and $1.5 million, respectively.

Amortization expense for each of the five succeeding years is projected as follows:

(In millions)	2013		2014		2015		2016		2017
	$	8.4	$	8.4	$	8.4	$	8.3	$	8.0

The change in the carrying amount of goodwill by reporting segment for the first quarter ended March 30, 2013, is as follows:

(In millions)	Water Systems			Fueling Systems			Consolidated
Balance as of December 29, 2012	$	144.9		$	63.2		$	208.1
Acquisitions	—			—			—
Adjustments to prior year acquisitions	—			—			—
Foreign currency translation	(0.9		)	(0.3		)	(1.2		)
Balance as of March 30, 2013	$	144.0		$	62.9		$	206.9

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FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 30, 2013

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

FASB ASC Topic 820, Fair Value Measurements and Disclosures, provides guidance for defining, measuring, and disclosing fair value within an established framework and hierarchy. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The standard established a fair value hierarchy which requires an entity to maximize the use of observable inputs and to minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value within the hierarchy are as follows:

Level 1 – Quoted prices for identical assets and liabilities in active markets;

Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and

Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

As of March 30, 2013, and December 29, 2012, the assets and liabilities measured at fair value on a recurring basis were as set forth in the table below. The "Recognized Loss" amounts in the table are accumulated totals since inception.

(In millions)	March 30, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Recognized Loss
Cash equivalents	$	12.8	$	12.8	$	—	$	—	$	—
Impo contingent consideration	—		—		—		—		—
	December 29, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Recognized Loss
Cash equivalents	$	13.8	$	13.8	$	—	$	—	$	—
Impo contingent consideration	5.6		—		—		5.6		0.8

The Company's Level 1 assets consist of cash equivalents which are generally comprised of domestic money market funds invested in high quality, short-term liquid assets, and foreign bank guaranteed certificates of deposit.

The Company has no assets or liabilities classified as Level 2.

During the second quarter of 2011, the Company recorded $5.5 million (TL 8.5 million) of contingent consideration related to the second quarter 2011 acquisition of Impo. The fair value of this Level 3 liability was $5.6 million (TL 10.0 million) as of December 29, 2012, based on Impo achieving specified financial targets. The contingent consideration of $5.6 million (TL 10.0 million) was paid out during the first quarter of 2013.

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OTHER ASSETS

3 Months Ended

Mar. 30, 2013

Equity Method Investments and Joint Ventures [Abstract]

OTHER ASSETS

OTHER ASSETS

In 2005, the Company acquired a 35.0 percent equity interest in Pioneer Pump, Inc. ("PPI"), which was accounted for using the equity method. During the first quarter of 2012, the shareholders of PPI and Pioneer Pump, Ltd. ("PPL") contributed shares to form a new holding company, PPH, in exchange for equivalent value and control in PPH. As a result of this contribution, the Company's equity interest decreased to 31.0 percent of PPH. On March 7, 2012, the Company acquired a controlling interest in PPH, resulting in the consolidation of PPH in the Company's financial statements. Accordingly, the original equity interest in PPH was remeasured to its fair value of $23.9 million as of March 7, 2012. The carrying amount of the equity investment prior to the acquisition of the controlling interest was $11.7 million as of March 6, 2012.  As a result, the Company recognized a one-time gain of $12.2 million in the "Other income" line of the Company's condensed consolidated statement of income for the first quarter ended March 31, 2012. Prior to the acquisition, the Company’s proportionate share of Pioneer Pump, Inc. earnings, included in the “Other income” line of the Company’s condensed consolidated statements of income, was $0.4 million for the first quarter ended March 31, 2012. The additional purchase was made in 2012, bringing total ownership to 70.5 percent.

During the second quarter of 2011, the Company entered into a loan agreement with the parent of a customer.  The current maturity is included in "Receivables" and the long-term portion is included in "Other assets" on the Company's consolidated balance sheet. The agreement provides for interest on the loan at a variable market interest rate with the customer to repay the loan plus interest in semi-annual installments throughout the 7-year term.  The Company has a long-term relationship with the customer and considers the loan fully collectible.

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EMPLOYEE BENEFIT PLANS

3 Months Ended

Mar. 30, 2013

Compensation and Retirement Disclosure [Abstract]

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS

Defined Benefit Plans - As of March 30, 2013, the Company maintained two domestic pension plans and three German pension plans. The Company used a December 29 measurement date for these plans.

Other Benefits - The Company's other postretirement benefit plan provides health and life insurance to domestic employees hired prior to 1992.

The following table sets forth the aggregated net periodic benefit cost for all pension plans for the first quarters ended March 30, 2013 and March 31, 2012, respectively:

(In millions)	Pension Benefits						Other Benefits
	First Quarter Ended						First Quarter Ended
	March 30, 2013			March 31, 2012			March 30, 2013		March 31, 2012
Service cost	$	0.4		$	0.4		$	—	$	—
Interest cost	1.9			2.1			0.1		0.1
Expected return on assets	(2.5		)	(2.6		)	—		—
Prior service cost	—			—			0.1		0.1
Loss	0.9			0.5			0.1		—
Total net periodic benefit cost	$	0.7		$	0.4		$	0.3	$	0.2

In the first quarter ended March 30, 2013, the Company made contributions to the funded plans of $1.6 million. The amount of contributions to be made to the plans during the calendar year 2013 will be finalized by September 15, 2013 based upon the desired level of funding as of the December 29, 2012year-end valuation.

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SEGMENT INFORMATION (Tables)

3 Months Ended

Mar. 30, 2013

Segment Reporting [Abstract]

Schedule of Financial Information by Reportable Business Segment

Financial information by reportable business segment is included in the following summary:

	First Quarter Ended				First Quarter Ended
(In millions)	March 30, 2013		March 31, 2012		March 30, 2013			March 31, 2012
	Net sales to external customers				Operating income (loss)
Water Systems	$	176.4	$	165.0	$	28.7		$	26.8
Fueling Systems	46.1		36.9		6.2			5.6
Other	—		—		(11.7		)	(11.4		)
Consolidated	$	222.5	$	201.9	$	23.2		$	21.0
	March 30, 2013		December 29, 2012
	Total assets
Water Systems	$	713.0	$	692.0
Fueling Systems	258.1		252.0
Other	25.4		32.4
Consolidated	$	996.5	$	976.4

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) (USD $)	3 Months Ended
	Mar. 30, 2013		Mar. 31, 2012
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ (57,146,000)		$ (49,300,000)
Pre-tax income/(loss)	(5,800,000)		11,200,000
Income tax expense	0		0
Other comprehensive income/(loss) before reclassifications, net of income taxes	(5,800,000)		11,200,000
Pre-tax income	1,000,000		600,000
Income tax expense	(400,000)		(200,000)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	600,000		400,000
Net current period other comprehensive income/(loss), net of income taxes	(5,199,000)		11,571,000
Comprehensive loss attributable to noncontrolling interest	400,000		300,000
Ending balance	(61,907,000)		(37,400,000)
Accumulated Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(200,000)		(2,100,000)
Pre-tax income/(loss)	(5,800,000)		11,200,000
Income tax expense	0		0
Other comprehensive income/(loss) before reclassifications, net of income taxes	(5,800,000)		11,200,000
Pre-tax income	0		0
Income tax expense	0		0
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	0		0
Net current period other comprehensive income/(loss), net of income taxes	(5,800,000)		11,200,000
Comprehensive loss attributable to noncontrolling interest	400,000		300,000
Ending balance	(5,600,000)		9,400,000
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(56,900,000)		(47,200,000)
Pre-tax income/(loss)	0		0
Income tax expense	0		0
Other comprehensive income/(loss) before reclassifications, net of income taxes	0		0
Pre-tax income	1,000,000	[1]	600,000	[1]
Income tax expense	(400,000)		(200,000)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	600,000		400,000
Net current period other comprehensive income/(loss), net of income taxes	600,000		400,000
Comprehensive loss attributable to noncontrolling interest	0		0
Ending balance	$ (56,300,000)		$ (46,800,000)

[1] This accumulated other comprehensive income (loss) component is included in the computation of net periodic pension cost (refer to Note 9 for additional details) and is included in the "Selling, general, and administrative expenses" line of the condensed consolidated statements of income.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

3 Months Ended

Mar. 30, 2013

Stockholders' Equity Note [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) by component for the three months ended March 30, 2013 and March 31, 2012 are summarized below:

(In millions)
For the Three Months Ended March 30, 2013:	Foreign Currency Translation Adjustments			Pension and Post-Retirement Plan Benefit Adjustments				Total
Balance, December 29, 2012	$	(0.2	)	$	(56.9	)		$	(57.1	)
Other comprehensive income/(loss) before reclassifications:
Pre-tax income/(loss)	(5.8		)	—				(5.8		)
Income tax expense	—			—				—
Other comprehensive income/(loss) before reclassifications, net of income taxes	(5.8		)	—				(5.8		)
Amounts reclassified from accumulated other comprehensive income/(loss):
Pre-tax income	—			1.0			(1)	1.0
Income tax expense	—			(0.4		)		(0.4		)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	—			0.6				0.6
Net current period other comprehensive income/(loss), net of income taxes	(5.8		)	0.6				(5.2		)
Comprehensive loss attributable to noncontrolling interest	0.4			—				0.4
Balance, March 30, 2013	$	(5.6	)	$	(56.3	)		$	(61.9	)
For the Three Months Ended March 31, 2012:
Balance, December 31, 2011	$	(2.1	)	$	(47.2	)		$	(49.3	)
Other comprehensive income/(loss) before reclassifications:
Pre-tax income/(loss)	11.2			—				11.2
Income tax expense	—			—				—
Other comprehensive income/(loss) before reclassifications, net of income taxes	11.2			—				11.2
Amounts reclassified from accumulated other comprehensive income/(loss):
Pre-tax income	—			0.6			(1)	0.6
Income tax expense	—			(0.2		)		(0.2		)
Amounts reclassified from accumulated other comprehensive income/(loss), net of income taxes	—			0.4				0.4
Net current period other comprehensive income/(loss), net of income taxes	11.2			0.4				11.6
Comprehensive loss attributable to noncontrolling interest	0.3			—				0.3
Balance, March 31, 2012	$	9.4		$	(46.8	)		$	(37.4	)

(1) This accumulated other comprehensive income (loss) component is included in the computation of net periodic pension cost (refer to Note 9 for additional details) and is included in the "Selling, general, and administrative expenses" line of the condensed consolidated statements of income.

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FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 30, 2013

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets Measured on Recurring Basis

As of March 30, 2013, and December 29, 2012, the assets and liabilities measured at fair value on a recurring basis were as set forth in the table below. The "Recognized Loss" amounts in the table are accumulated totals since inception.

(In millions)	March 30, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Recognized Loss
Cash equivalents	$	12.8	$	12.8	$	—	$	—	$	—
Impo contingent consideration	—		—		—		—		—
	December 29, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Recognized Loss
Cash equivalents	$	13.8	$	13.8	$	—	$	—	$	—
Impo contingent consideration	5.6		—		—		5.6		0.8

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DEBT (Debt Payments Expected to be Paid) (Details) (USD $) In Millions, unless otherwise specified	Mar. 30, 2013	Dec. 29, 2012
Long-term Debt, Fiscal Year Maturity
Debt and capital lease oligations	$ 190.8	$ 165.9
Year 1	15.9
Year 2	1.1
Year 3	31.1
Year 4	31.2
Year 5	31.1
More than 5 years	80.4
Debt
Long-term Debt, Fiscal Year Maturity
Long-term debt	189.9
Year 1	15.7
Year 2	0.9
Year 3	30.9
Year 4	31.0
Year 5	31.0
More than 5 years	80.4
Capital leases
Long-term Debt, Fiscal Year Maturity
Long-term debt	0.9
Year 1	0.2
Year 2	0.2
Year 3	0.2
Year 4	0.2
Year 5	0.1
More than 5 years	$ 0

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FAIR VALUE MEASUREMENTS (Details) (Recurring Basis, USD $) In Millions, unless otherwise specified	Mar. 30, 2013	Dec. 29, 2012
Estimate of Fair Value, Fair Value Disclosure [Member]
Fair Value, Assets Measured on Recurring and Nonrecurring Basis
Cash equivalents	$ 12.8	$ 13.8
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets Measured on Recurring and Nonrecurring Basis
Cash equivalents	12.8	13.8
Significant Other Observable Inputs (Level 2)
Fair Value, Assets Measured on Recurring and Nonrecurring Basis
Cash equivalents	0	0
Significant Unobservable Inputs (Level 3)
Fair Value, Assets Measured on Recurring and Nonrecurring Basis
Cash equivalents	$ 0	$ 0

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Mar. 30, 2013	Dec. 29, 2012
Current assets:
Allowance for doubtful accounts (in dollars)	$ 3,269	$ 3,148
Shareowners' equity:
Common shares, authorized (in shares)	65,000,000	65,000,000
Common shares, par value (in dollars per share)	$ 0.10	$ 0.10
Common shares, outstanding	47,412,000	47,132,000

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ACQUISITIONS

3 Months Ended

Mar. 30, 2013

Business Combinations [Abstract]

ACQUISITIONS

ACQUISITIONS

The fair values of the identifiable intangible assets and property, plant, and equipment for the 2012 Pioneer Pump Holdings, Inc. ("PPH") acquisition were final as of the first quarter ended March 30, 2013. The Company utilized management estimates and consultation with an independent third-party valuation firm to assist in the valuation. No adjustments were required as a result of the final valuation to the preliminary amounts previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2012.

Transaction costs were expensed as incurred under the guidance of FASB ASC Topic 805, Business Combinations.

There were no transaction costs included in selling, general, and administrative expense in the Company’s condensed consolidated statement of income for the first quarter ended March 30, 2013.

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INTANGIBLE ASSETS AND GOODWILL (TABLES)

3 Months Ended

Mar. 30, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Carrying Amounts of Intangible Assets

The carrying amounts of the Company’s intangible assets are as follows:

(In millions)	March 30, 2013					December 29, 2012
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangibles:
Patents	$	7.8	$	(5.7	)	$	7.8	$	(5.7	)
Supply agreements	4.4		(4.4		)	4.4		(4.4		)
Technology	7.5		(3.4		)	7.5		(3.2		)
Customer relationships	125.3		(24.8		)	125.9		(23.1		)
Software	1.7		(0.1		)	1.7		(0.1		)
Other	1.2		(1.2		)	1.2		(1.2		)
Total	$	147.9	$	(39.6	)	$	148.5	$	(37.7	)
Unamortized intangibles:
Trade names	47.1		—			47.3		—
Total intangibles	$	195.0	$	(39.6	)	$	195.8	$	(37.7	)

Schedule of Amortization Expense

Amortization expense for each of the five succeeding years is projected as follows:

(In millions)	2013		2014		2015		2016		2017
	$	8.4	$	8.4	$	8.4	$	8.3	$	8.0

Schedule of Change in the Carrying Amount of Goodwill by Reporting Segment

The change in the carrying amount of goodwill by reporting segment for the first quarter ended March 30, 2013, is as follows:

(In millions)	Water Systems			Fueling Systems			Consolidated
Balance as of December 29, 2012	$	144.9		$	63.2		$	208.1
Acquisitions	—			—			—
Adjustments to prior year acquisitions	—			—			—
Foreign currency translation	(0.9		)	(0.3		)	(1.2		)
Balance as of March 30, 2013	$	144.0		$	62.9		$	206.9

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ACQUISITIONS (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 30, 2013
Business Acquisition [Line Items]
Business combination, acquisition related costs	$ 0

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EQUITY ROLL FORWARD

3 Months Ended

Mar. 30, 2013

Equity [Abstract]

EQUITY ROLL FORWARD

EQUITY ROLL FORWARD

The schedule below sets forth equity changes in the three months ended March 30, 2013:

(In thousands)	Common Stock			Additional Paid in Capital		Retained Earnings			Minimum Pension Liability			Cumulative Translation Adjustment			Noncontrolling Interest		Total Equity			Redeemable Noncontrolling Interest
Balance as of December 29, 2012	$	4,712		$	170,890	$	395,950		$	(56,936	)	$	(210	)	$	2,580	$	516,986		$	5,263
Net income						15,456									209		15,665			(50		)
Dividends on common stock						(3,417		)									(3,417		)
Common stock issued	31			4,106		(9		)									4,128
Common stock repurchased or received for stock options exercised	(7		)			(2,499		)									(2,506		)
Share-based compensation	5			2,153													2,158
Tax benefit of stock options exercised				1,975													1,975
Currency translation adjustment												(5,351		)	197		(5,154		)	(635		)
Pension liability, net of taxes									590								590
Balance as of March 30, 2013	$	4,741		$	179,124	$	405,481		$	(56,346	)	$	(5,561	)	$	2,986	$	530,425		$	4,578