Franklin Electric to Acquire JBD, INC.

The Company plans to sell its submersible motor products in North America directly to Water Systems Distributors beginning November 2004. The Company believes that this change to its distribution channel will result in lower costs, lower investment in inventories and quicker delivery for its distributors.

R. Scott Trumbull, Chairman and Chief Executive Officer of the Company, stated “These changes are significant for us and for our customers and represent our efforts to respond to the changing market conditions in the submersible water systems industry. In recent years market conditions have changed; there has been a significant consolidation of industry players at both the submersible pump OEM and distributor levels. In light of these conditions, we believe that changes to our Water Systems Distribution Channel to allow for direct sales to distributors are necessary, appropriate and in the best interests of Franklin and the industry we serve.”

“Our prices to distribution (through both OEMs and distributors) will be set at a level modestly above that needed to recover our additional marketing and selling costs on an ongoing basis. It is our expectation that there will be little impact to our 2004 profitability, after considering the start-up costs of this endeavor. For 2005, we expect our operating margins to expand modestly.”

As to the Company’s proposed acquisition of JBD, Inc., Mr. Trumbull commented, “As we discussed our direct sales plan with our major distributors, they encouraged us to consider acquiring a pump product line in addition to selling our motors directly to them. These distributors pointed out that JBD, Inc. has a reputation for excellent quality and hydraulics technology. As a long time supplier to JBD, we were already aware that it has a seasoned management team and operates out of a well-maintained 250,000 sq. ft. facility in Little Rock, Arkansas. During due diligence we confirmed the overall quality of JBD’s pump product lines and found that JBD’s manufacturing capacity could be significantly expanded with only incremental investment. We believe that with Franklin’s global purchasing reach we can reduce JBD’s manufacturing costs, and that with Franklin’s manufacturing, technical and logistics support we can improve quality and availability as well. We are confident that we will be able to significantly increase JBD’s current annual sales rate of about $30 million.”

The Company expects to close the JBD acquisition within the next thirty days. The total consideration for the transaction was not disclosed; however, the Company will pay for this acquisition out of cash on hand. While the Company expects the acquisition to be immediately accretive to earnings, given the relatively modest size of the transaction, the Company expects that the accretion in 2004 will be approximately one cent per share.

Commenting on the relationship between the Company’s distribution channel change and its acquisition of JBD, Mr. Trumbull stated, “We believe our acquisition of JBD will enhance our plans for selling motors directly to distributors. We also believe that it may open the door to new longer term growth opportunities for Franklin. It should enable us to approach our core global water well market from a total systems perspective. We now can combine our world leading submersible scale and technology with hydraulics skills to produce superior products to help meet the world’s growing need for water.”

“We believe we are uniquely positioned to attack this global market opportunity. We are the world leader in submersible electric motor technology. We are also the world leader in submersible motor drives and control technology, and with the addition of JBD’s management team and other technical resources, we will have world-class hydraulics skills as well. We intend to fully integrate our technical and product design expertise in these three areas to develop continuously improving, highly reliable, cost-effective submersible water pumping systems for the global market. These changes have the potential to improve our profitability and prospects for growth going forward by increasing both our product line and our customer base.”