nVent Electric plc (Form: 10-K, Received: 02/25/2020 16:53:04)

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K



☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2019



☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-38265

nVent Electric plc

(Exact name of Registrant as specified in its charter)



Ireland		98-1391970
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification number)

The Mille, 1000 Great West Road, 8th Floor (East), London, TW8 9DW, United Kingdom



(Address of principal executive offices)

Registrant's telephone number, including area code: 44-20-3966-0279

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading symbol	Name of each exchange on which registered
Ordinary Shares, nominal value $0.01 per share	NVT	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No þ

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. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes þ No ¨

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



Large accelerated filer	☑	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No þ

Aggregate market value of voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of $24.79 per share as reported on the New York Stock Exchange on June 28, 2019 (the last business day of Registrant's most recently completed second quarter): $4,146,966,237.

The number of shares outstanding of Registrant's only class of common stock on December 31, 2019 was 169,492,538.

DOCUMENTS INCORPORATED BY REFERENCE

Parts of the Registrant's definitive proxy statement for its annual general meeting to be held on May 15, 2020, are incorporated by reference in this Form 10-K in response to Part III, ITEM 10, 11, 12, 13 and 14.

nVent Electric plc

Annual Report on Form 10-K

For the Year Ended December 31, 2019



		Page
PART I

ITEM 1.	Business	1

ITEM 1A.	Risk Factors	4

ITEM 1B.	Unresolved Staff Comments	16

ITEM 2.	Properties	17

ITEM 3.	Legal Proceedings	18

ITEM 4.	Mine Safety Disclosures	18

PART II

ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	21

ITEM 6.	Selected Financial Data	23

ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

ITEM 7A.	Quantitative and Qualitative Disclosures about Market Risk	40

ITEM 8.	Financial Statements and Supplementary Data	41

ITEM 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	78

ITEM 9A.	Controls and Procedures	78

ITEM 9B.	Other Information	78

PART III

ITEM 10.	Directors, Executive Officers and Corporate Governance	79

ITEM 11.	Executive Compensation	79

ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	79

ITEM 13.	Certain Relationships and Related Transactions and Director Independence	80

ITEM 14.	Principal Accounting Fees and Services	80

PART IV

ITEM 15.	Exhibits and Financial Statement Schedules	81

ITEM 16.	Form 10-K Summary	83

	Signatures	84

PART I

ITEM 1. BUSINESS

GENERAL

nVent Electric plc is a leading global provider of electrical connection and protection solutions. We believe our inventive electrical solutions enable safer systems and ensure a more secure world. We design, manufacture, market, install, and service high performance products and solutions that connect and protect some of the world’s most sensitive equipment, buildings, and critical processes. We offer a comprehensive range of enclosures, electrical fastening solutions, and thermal management solutions across industry-leading brands that are recognized globally for quality, reliability, and innovation.

Our broad range of products and solutions connect and protect our customers’ mission-critical equipment from hazardous conditions, improving their utilization, lowering costs, and minimizing downtime. The cost of our products typically represents a small proportion of the total cost of our customers’ end systems. We also are a small cost relative to the potential cost of failure that our products help avoid. We have a portfolio of premier, industry-leading brands, including nVent CADDY, ERICO, HOFFMAN, RAYCHEM, SCHROFF, and TRACER, some of which have a history spanning over 100 years, that cover a wide range of verticals, including Industrial, Commercial & Residential, Energy, and Infrastructure.

Unless the context otherwise indicates, references herein to "nVent," the "Company," and such words as "we," "us," and "our" include nVent Electric plc and its consolidated subsidiaries. Our principal office is in London, United Kingdom and our management office in the United States is in Minneapolis, Minnesota. The Company was incorporated in Ireland on May 30, 2017.

HISTORY AND DEVELOPMENT

On April 30, 2018, Pentair plc ("Pentair" or "former Parent") completed the separation of its Water business and its Electrical business into two independent, publicly-traded companies (the "separation"). To effect the separation, Pentair distributed to its shareholders one ordinary share of nVent for every ordinary share of Pentair held as of the record date of April 17, 2018. As a result of the distribution, nVent is now an independent publicly-traded company and began "regular way" trading under the symbol "NVT" on the New York Stock Exchange on May 1, 2018.

Although our jurisdiction of organization is Ireland, we manage our affairs so that we are centrally managed and controlled in the United Kingdom (the "U.K.") and have our tax residency in the U.K.

Our roots within Pentair trace back to the acquisition of Federal-Hoffman Corporation in 1988, which included the nVent HOFFMAN enclosures brand. From that starting point, we have grown both organically and via acquisition. Our Enclosures business first applied lean principles within the organization in the 1990s, leveraging its culture of customer service and operational excellence. In 2012, Pentair merged with Tyco International Ltd.’s Flow Control division, which included our Thermal Management business and the nVent RAYCHEM brand, a global leader in heat tracing solutions. In 2015, Pentair acquired ERICO Global Company, a leading global manufacturer of superior engineered electrical and fastening products, which operates as our Electrical & Fastening Solutions business, broadening our product offering and enabling us to provide additional global solutions to our combined customers.

We aim to continue our journey as a “One nVent” organization, with unified focus on commercial excellence, digital transformation, scaled and integrated technology, including Internet of Things (“IoT”), and global presence and capabilities. As we scale our capabilities under our umbrella brand of nVent, we expect to expand our products and solutions and to continue to differentiate our company by creating solutions that solve problems for our customers.

Our Spark management system defines how we operate. The five elements of Spark are People, Growth, Lean, Digital and Velocity. Together, they provide the mindset and operating system to propel the success of our new company. Spark supports the high performance culture we are building at nVent.


•	People are at the core of Spark, positively impacting our business and growing their careers.


•	Growth is the foundation of Spark, driving shareholder, customer and employee value.


•	Lean is the relentless pursuit of eliminating waste and increasing velocity.


•	Digital transforms our products and how we do business, improving both customer and employee experiences.


•	Velocity is increasing speed in all we do for each other and our customers.

BUSINESS AND PRODUCTS

We operate across three segments: Enclosures, Thermal Management, and Electrical & Fastening Solutions. The following is a brief description of each of the Company's reportable segments and business activities.

Enclosures

Our Enclosures business provides innovative solutions to connect and protect critical electronics, communication, control, and power equipment. We are a leader in the enclosures sector, and our key brands, nVent HOFFMAN and SCHROFF, have a long history of solving customers’ problems by providing high quality solutions.

nVent HOFFMAN provides trusted enclosure solutions for challenging operating environments and is one of the largest brands of enclosures in North America and a leader globally. The offerings connect and protect through reliable solutions that protect, power and cool equipment used by panel builders, original equipment manufacturers and directly by other end-users, including customized products for hazardous environments. The nVent HOFFMAN brand is over 70 years old and is recognized for delivering superior building, testing, certification and overall product quality. nVent HOFFMAN’s product customization and global footprint, along with reputation, have helped it garner long-standing relationships with many of the world’s largest industrial companies.

nVent SCHROFF provides highly-customized and technologically-advanced enclosures. These products connect and protect mission-critical electronics and communications equipment by providing a wide range of innovative standard products and customized solutions. nVent SCHROFF’s innovation is demonstrated by its constant flow of new product designs, including a focus on smart products capable of providing connectivity and remote management. The nVent SCHROFF brand is a leader due to its product flexibility and customer-first focus.

Thermal Management

Our Thermal Management business provides electric thermal solutions that connect and protect critical buildings, infrastructure, industrial processes, and people. Its highly reliable and easy-to-install solutions lower total cost of ownership to building owners, facility managers, operators, and end users. Thermal Management’s products have been installed in some of the world’s most iconic buildings.

For Industrial and Energy, we provide industrial heat-tracing and wiring, control and monitoring, sensing, engineering, and construction services under industry leading nVent RAYCHEM and TRACER brands, primarily serving the energy and power industries. Products and solutions include heat tracing for freeze protection and process temperature maintenance, temperature control and monitoring systems, heat-traced tubing bundles, instrument winterization, and tank heating systems. For Commercial and Infrastructure, we provide products and services primarily under our nVent RAYCHEM brand. Applications include pipe freeze protection, roof and gutter de-icing, surface snow melting, hot water temperature maintenance, floor heating, and freeze and frost prevention for hospitals, sports venues, hotels, commercial offices, and education facilities.

Electrical & Fastening Solutions

Our Electrical & Fastening Solutions business provides fastening solutions that connect and protect electrical and mechanical systems and civil structures.

We are a global leader in fastening solutions with spring steel and specialty metal fixings and reinforced steel connections, and our products are primarily marketed under the nVent CADDY brand. Our products reduce total installed cost by ease of installation, provide design flexibility and increase structural integrity in electrical and mechanical fastening applications through inventive products and solutions and customer intimacy. These products are targeted towards Commercial and Industrial verticals with applications in fire & seismic, data & telecommunications, electrical fastening, and heating, ventilation & air conditioning. These products are primarily used by electricians, telecommunications installers, and roof top contractors.

We are also a global leader in bonding, grounding, lightning protection, and low voltage power distribution products and solutions. These products are primarily marketed under the nVent ERICO brand. We offer a comprehensive range of facility electrical connection and protection solutions to protect against electrical transients to improve safety and reliability of electrical systems. Our products reduce total cost of ownership and provide design flexibility by offering maintenance free and reliable products and global end-user application expertise and intimacy. These products and solutions are primarily used by electricians, panel builders, energy contractors, and lightning protection installers.

Competition

We believe that we are a global leader in each of our segments. Given the range of products and services we offer, we encounter a wide variety of competitors, including large, global competitors, established regional competitors, and niche competitors in select regions. We face increased competition in a number of our verticals as a result of new local competitors who compete on price and increased consolidation in specific segments. The Thermal Management segment serves industries and verticals that are highly fragmented, and competes with global and local suppliers. The Electrical & Fastening Solutions segment serves industries and verticals that are relatively fragmented, with a small number of large competitors and a large number of smaller competitors. Competition for our Thermal Management and Electrical & Fastening Solutions segments focuses on product performance, quality, and service.

Our success depends on a variety of factors, including technical expertise, reputation for quality and reliability, timeliness of delivery, previous installation history, contractual terms, and price. As many of our products sell through electrical distributors, data center contractors, original equipment manufacturers, and maintenance contractors, our success also depends on building and partnering with a strong channel and distribution network.

Seasonality

We generally experience increased demand for Thermal Management products and services during the fall and winter months in the Northern Hemisphere and increased demand for Electrical & Fastening Solutions products during the spring and summer months in the Northern Hemisphere.

Backlog of Orders by Segment



	December 31
In millions	2019		2018		$ change			% change
Enclosures	$	114.3	$	138.6	$	(24.3	)	(17.5	%)
Thermal Management	156.7		118.6		38.1			32.1
Electrical & Fastening Solutions	28.8		22.5		6.3			28.0
Total	$	299.8	$	279.7	$	20.1		7.2	%

A substantial portion of our revenues result from orders received and products delivered in the same month. Our backlog typically has a short manufacturing cycle and products generally ship within 90 days of the date on which a customer places an order. However, a portion of our backlog, particularly from orders for major capital projects, can take more than one year depending on the size and type of order. We record as part of our backlog all orders from external customers, which represent firm commitments, and are supported by a purchase order or other legitimate contract. We expect the majority of our backlog at December 31, 2019 will be shipped in 2020. Despite the favorable long-term outlook for our end-markets, we experience volatility in the level of our backlog depending on the end-market and may continue to do so over the medium and longer term.

Raw materials

The principal materials we use in manufacturing our products are mild steel, stainless steel, electronic components, plastics (resins, fiberglass, epoxies), copper and paint (powder and liquid). In addition to the purchase of raw materials, we purchase some finished goods for distribution through our sales channels.

We purchase the materials we use in various manufacturing processes on the open market and the majority is available through multiple sources which are in adequate supply. We have not experienced any significant work stoppages to date due to shortages of materials. We have certain long-term commitments, principally price commitments, for the purchase of various component parts and raw materials and believe that it is unlikely that any of these agreements would be terminated prematurely. Alternate sources of supply at competitive prices are available for most materials for which long-term commitments exist and we believe that the termination of any of these commitments would not have a material adverse effect on our financial position, results of operations or cash flows.

Certain commodities, such as metals and resin, are subject to market and duty-driven price fluctuations. We manage these fluctuations through several mechanisms, including long-term agreements with price adjustment clauses for significant commodity market movements in certain circumstances. Prices for raw materials, such as metals and resins, may trend higher in the future.

Intellectual property

Patents, non-compete agreements, proprietary technologies, customer relationships, trademarks, trade names and brand names are important to our business. However, we do not regard our business as being materially dependent upon any single patent, non-compete agreement, proprietary technology, customer relationship, trademark, trade name or brand name.

Patents, patent applications and license agreements will expire or terminate over time by operation of law, in accordance with their terms or otherwise. We do not expect the termination of patents, patent applications or license agreements to have a material adverse effect on our financial position, results of operations or cash flows.

Employees

As of December 31, 2019, we employed approximately 9,500 people worldwide.

Captive insurance subsidiary

We insure certain general and product liability, property, workers' compensation and automobile liability risks through our regulated wholly-owned captive insurance subsidiary, Tonka Bay Insurance Company ("Tonka Bay"). Reserves for policy claims are established based on actuarial projections of ultimate losses. Accruals are established with respect to liabilities insured by third parties, such as liabilities arising from acquired businesses, pre-Tonka Bay liabilities and those of certain non-U.S. operations.

Matters pertaining to Tonka Bay are discussed in ITEM 3, included in this Form 10-K.

Available information

We make available free of charge (other than an investor's own Internet access charges) through our Internet website (http://www.nvent.com) our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and if applicable, amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission ("SEC"). Reports of beneficial ownership filed by our directors and executive officers pursuant to Section 16(a) of the Exchange Act are also available on our website. We are not including the information contained on our website as part of, or incorporating it by reference into, this Annual Report on Form 10-K.

ITEM 1A. RISK FACTORS

You should carefully consider all of the information in this document and the following risk factors before making an investment decision regarding our securities. Any of the following risks could materially and adversely affect our business, financial condition, results of operations, cash flows and the actual outcome of matters as to which forward-looking statement are made in this document.

Risks Relating to Our Business

General global economic and business conditions affect demand for our products.

We compete in various geographic regions and product markets around the world. Among these, the most significant are global industrial markets and commercial markets. We expect to experience fluctuations in revenues and results of operations due to economic and business cycles. Important factors for our business and the businesses of our customers include the overall strength of the economy and our customers’ confidence in the economy, industrial and governmental capital spending, the strength of the commercial real estate market, unemployment rates, availability of consumer and commercial financing, interest rates and energy and commodity prices. The businesses of many of our industrial customers are to varying degrees cyclical and have experienced periodic downturns. While we attempt to minimize our exposure to economic or market fluctuations by serving a balanced mix of end markets and geographic regions, any of the above factors, individually or in the aggregate, or a significant or sustained downturn in a specific end market or geographic region could reduce demand for our products and services, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We compete in attractive markets with a high level of competition, which may result in pressure on our profit margins and limit our ability to maintain or increase the market share of our products.

The markets for our products and services are geographically diverse and highly competitive. We compete against large and well-established national and global companies, as well as regional and local companies and lower-cost manufacturers. We compete based on technical expertise, reputation for quality and reliability, timeliness of delivery, previous installation history, contractual terms and price. Some of our competitors, in particular smaller companies, attempt to compete based primarily on price, localized expertise and local relationships, especially with respect to products and applications that do not require a great deal of engineering or technical expertise. In addition, during economic downturns average selling prices tend to decrease as market participants compete more aggressively on price. If we are unable to continue to differentiate our products, services and solutions, or if we are forced to cut prices or to incur additional costs to remain competitive, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Volatility in currency exchange rates could have a material adverse effect on our financial condition, results of operations and cash flows.

Sales outside of the U.S. for the year ended December 31, 2019 accounted for approximately 40% of our net sales. Our financial statements reflect translation of items denominated in non-U.S. currencies to U.S. dollars. Therefore, if the U.S. dollar strengthens in relation to the principal non-U.S. currencies from which we derive revenue as compared to a prior period, our U.S. dollar-reported revenue and income will effectively be decreased to the extent of the change in currency valuations and vice-versa. For the year ended December 31, 2019, foreign currency translations had a 1.6% negative impact on our net sales. Fluctuations in foreign currency exchange rates, most notably the strengthening of the U.S. dollar against the euro, could have a material adverse effect on our reported revenue and income in future periods.

Our future growth is dependent upon our ability to adapt our products, services and organization to meet the demands of local markets in both developed and emerging economies and by developing or acquiring new technologies that achieve market acceptance with acceptable margins.

We operate in global markets that are characterized by customer demand that is often global in scope but localized in delivery. We compete with thousands of smaller regional and local companies that may be positioned to offer products produced at lower cost than ours, or to capitalize on highly localized relationships and knowledge that are difficult for us to replicate. Also, in several emerging markets potential customers prefer local suppliers, in some cases because of existing relationships and in other cases because of local legal restrictions or incentives that favor local businesses. Accordingly, our future success depends upon a number of factors, including our ability to adapt our products, services, organization, workforce and sales strategies to fit localities throughout the world, particularly in high-growth emerging markets; identify emerging technological and other trends in our target end markets; and develop or acquire competitive products and services and bring them to market quickly and cost-effectively. The failure to effectively adapt our products or services could have a material adverse effect on our business, financial condition, results of operations and cash flows.

A sustained downturn in the energy industry, due to oil and gas prices decreasing or otherwise, could decrease demand for some of our products and services.

A portion of our revenue historically has been generated by end-users in the oil and gas markets where we serve all three major categories of customers in the petroleum industry—upstream exploration/production, midstream transportation and downstream refining. The businesses of most of our customers in the energy industry are, to varying degrees, cyclical and historically have experienced periodic downturns. Profitability in the energy industry is highly sensitive to supply and demand cycles and commodity prices, which historically have been volatile, and our customers in this industry have tended to delay large capital projects, including expensive maintenance and upgrades, during industry downturns. Customer project delays and cancellations may limit our ability to realize value from our backlog as expected and cause fluctuations in the timing or the amount of revenue earned and the profitability of our business in a particular period. In addition, such delays and cancellations may lead to significant fluctuations in results of operations from quarter to quarter, making it difficult to predict our financial performance on a quarterly basis.

Demand for a portion of our products and services depends upon the level of capital expenditure by companies in the energy industry, which depends, in part, on energy prices. Prices of oil and gas are volatile and within recent years, the price of crude oil has declined significantly. We have experienced suspensions or delays in large capital projects within the energy sector, especially in the upstream exploration and production sector, and most notably in Canada. A sustained downturn in the capital expenditures of our customers, whether due to a decrease in the market price of oil and gas or otherwise, may delay projects, decrease demand for our products and services and cause downward pressure on the prices we charge, which, in turn, could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We may not be able to identify, finance and complete suitable acquisitions and investments, and any completed acquisitions and investments could be unsuccessful or consume significant resources.

Our business strategy is expected to include acquiring businesses and making investments that complement our existing business. We expect to analyze and evaluate the acquisition of strategic businesses or product lines with the potential to strengthen our industry position or enhance our existing set of product and service offerings. We may not be able to identify suitable acquisition candidates, obtain financing or have sufficient cash necessary for acquisitions or successfully complete acquisitions in the future. Acquisitions and investments may involve significant cash expenditures, debt incurrences, equity issuances, operating losses and expenses. Acquisitions involve numerous other risks, including:


•	diversion of management time and attention from daily operations;


•	difficulties integrating acquired businesses, technologies and personnel into our business;


•	difficulties in obtaining and verifying the financial statements and other business information of acquired businesses;


•	inability to obtain required regulatory approvals;


•	potential loss of key employees, key contractual relationships or key customers of acquired companies or of ours;


•	assumption of the liabilities and exposure to unforeseen liabilities of acquired companies, including risks relating to the U.S. Foreign Corrupt Practices Act (the “FCPA”); and


•	dilution of interests of holders of nVent ordinary shares through the issuance of equity securities or equity-linked securities.

It may be difficult for us to complete transactions quickly and to integrate acquired operations efficiently into our business operations. Any acquisitions or investments may not be successful and may ultimately result in impairment charges and have a material adverse effect on our business, financial condition, results of operations and cash flows.

We may not achieve some or all of the expected benefits of our business initiatives.

In order to align our resources with our growth strategies, operate more efficiently and control costs, we may periodically announce restructuring plans, which may include workforce reductions, global plant closures and consolidations, asset impairments and other cost reduction initiatives. We may undertake restructuring actions and workforce reductions in the future. As these plans and actions are complex, we may not be able to achieve the operating efficiencies to reduce costs or realize benefits that were anticipated in connection with these initiatives. If we are unable to execute these initiatives as planned, we may not realize all or any of the anticipated benefits, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our success depends on attracting and retaining qualified personnel.

Our ability to sustain and grow our business requires us to hire, retain and develop a highly skilled and diverse management team and workforce. Failure to ensure that we have the depth and breadth of personnel with the necessary skill set and experience, or the loss of key employees, could impede our ability to deliver our growth objectives and execute our strategy.

Our backlog may fluctuate and material amounts of cancellations or reductions of orders or a failure to deliver our backlog on time could affect our future sales.

Our backlog is comprised of the portion of firm signed purchase orders or other written contractual commitments received from customers that we have not recognized as revenue. Backlog may increase or decrease based on the addition of large multi-year projects and their subsequent completion. Backlog may also be favorably or unfavorably affected by foreign currency rate fluctuations. The dollar amount of backlog as of December 31, 2019 was $299.8 million. The timing of our recognition of revenue out of our backlog is subject to a variety of factors that may cause delays, many of which, including fluctuations in our customers’ delivery schedules, are beyond our control. Such delays may lead to significant fluctuations in results of operations from quarter to quarter, making it difficult to predict our financial performance on a quarterly basis. Further, while we have historically experienced few order cancellations and the amount of order cancellations has not been material compared to our total contract volume, if we were to experience a significant amount of cancellations of or reductions in purchase orders, it would reduce our backlog and, consequently, our future sales and could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our future revenue depends in part on our ability to bid and win new contracts.

Our future revenue and overall results of operations require us to successfully bid on new contracts and, in particular, contracts for large greenfield projects, which are frequently subject to competitive bidding processes. Our revenue from major projects depends in part on the level of capital expenditures in some of our principal end markets, including the energy, chemical processing and power generation industries. The number of such projects we win in any year fluctuates, and is dependent upon the number of projects available and our ability to bid successfully for such projects. Contract proposals and negotiations are complex and frequently involve a lengthy bidding and selection process, which is affected by a number of factors, such as competitive position, market conditions, financing arrangements and required governmental approvals. If negative market conditions arise, or if we fail to secure adequate financial arrangements or required governmental approvals, we may not be able to pursue particular projects or win new contracts, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We are exposed to political, regulatory, economic and other risks that arise from operating a multinational business.

Sales outside of the U.S. for the year ended December 31, 2019 accounted for approximately 40% of our net sales. Further, our business obtains some products, components and raw materials from non-U.S. suppliers. Accordingly, our business is subject to the political, regulatory, economic and other risks that are inherent in operating in numerous countries. These risks include:


•	the imposition of tariffs, exchange controls or other trade restrictions;


•	changes in general economic and political conditions in countries where we operate, particularly in emerging markets;


•	relatively more severe economic conditions in some international markets than in the U.S.;


•	the difficulty of enforcing agreements and collecting receivables through non-U.S. legal systems;


•	the difficulty of communicating and monitoring standards and directives across our global facilities;


•	trade protection measures and import or export licensing requirements and restrictions;


•	the possibility of terrorist action affecting us or our operations;


•	the threat of nationalization and expropriation;


•	difficulty in staffing and managing widespread operations in non-U.S. labor markets;


•	changes in tax treaties, laws or rulings that could have a material adverse impact on our effective tax rate;


•	limitations on repatriation of earnings;


•	the difficulty of protecting intellectual property in non-U.S. countries; and


•	changes in and required compliance with a variety of non-U.S. laws and regulations.

Our success depends in part on our ability to anticipate and effectively manage these and other risks. We cannot assure you that these and other factors will not have a material adverse effect on our international operations or on our business as a whole.

Violations of the U.S. Foreign Corrupt Practices Act and similar anti-corruption laws outside the U.S. or international trade compliance regulations could have a material adverse effect on us.

The FCPA and similar anti-corruption laws in other jurisdictions generally prohibit companies and their intermediaries from making improper payments to government officials or other persons for the purpose of obtaining or retaining business. We operate in many parts of the world that are recognized as having governmental and commercial corruption and in certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices. Because many of our customers and end users are involved in infrastructure construction and energy production, they are often subject to increased scrutiny by regulators.

Further, our global operations require importing and exporting goods and technology across international borders on a regular basis. Certain of the products we manufacture are “dual use” products, which are products that may have both civil and military applications, or may otherwise be involved in weapons proliferation, and are often subject to more stringent export controls. From time to time, we may obtain or receive information alleging improper activity in connection with imports or exports.

Our policies mandate strict compliance with applicable laws and regulations, including those pertaining to anti-corruption, anti-bribery and trade. However, even when we are in strict compliance with law and our policies, we may suffer reputational damage if certain of our products are sold through various intermediaries to entities operating in sanctioned countries. We cannot assure that our internal control policies and procedures will always protect us from reckless or criminal acts committed by our employees or third-party intermediaries. In the event that we believe or have reason to believe that our employees or agents have or may have violated applicable laws, we may be required to investigate or have outside counsel investigate the relevant facts and circumstances, which can be expensive and require significant time and attention from senior management. Violations of these laws may require self-disclosure to governmental agencies and result in criminal or civil sanctions, which could disrupt our business, cause denial of import or export privileges, and result in a material adverse effect on our reputation, business, financial condition, results of operations and cash flows.

Catastrophic and other events beyond our control may disrupt operations at our manufacturing facilities and those of our suppliers, which could cause us to be unable to meet customer demands or increase our costs or reduce customer spending.

If operations at any of our manufacturing facilities or those of our suppliers were to be disrupted as a result of significant equipment failures, natural disasters, earthquakes, power outages, fires, explosions, terrorism, adverse weather conditions, labor disputes, public health epidemics or other catastrophic events or events outside of our control, we may be unable to fill customer orders and otherwise meet customer demand for our products. In addition, these types of events may negatively impact consumer, commercial and industrial spending in impacted regions or, depending on the severity, globally. As a result, any of such events could have a material adverse effect our business, financial condition, results of operations and cash flows. Interruptions in production, in particular at our manufacturing facilities, could increase our costs and reduce our sales. Any interruption in production capability could require us to make substantial capital expenditures to fill customer orders. We maintain property damage insurance that we believe to be adequate to provide for reconstruction of facilities and equipment, as well as business interruption insurance to mitigate losses resulting from any production interruption or shutdown caused by an insured loss. However, any recovery under our insurance policies may not offset the lost sales or increased costs that may be experienced during the disruption of operations, which could have a material adverse effect our business, financial condition, results of operations and cash flows.

We may experience material cost and other inflation.

In the past, we have experienced material cost and other inflation in a number of our businesses. We strive for productivity improvements and implement increases in selling prices to help mitigate cost increases in raw materials, freight, energy, wage and other costs such as pension, health care and insurance. We continue to implement operational initiatives, including commodity price lock strategies, in order to mitigate the impact of this inflation and continuously reduce our costs. However, these actions may not be successful in managing our costs or increasing our productivity. Continued cost inflation or failure of our initiatives to generate cost savings or improve productivity could have a material adverse effect on our business, financial condition, results of operations and cash flows.

A disruption in the availability, price or quality of products or materials that we manufacture and source from various countries throughout the world could have a material adverse effect on our results of operations.

Our business is subject to risks associated with global manufacturing and sourcing. We use a variety of raw materials in the production of our products including steel, aluminum, brass, copper, bronze, zinc, nickel and plastics. We also purchase certain electrical and electronic components from a number of suppliers. Significant shortages in the availability of these materials or price increases could increase our operating costs and adversely impact the competitive positions of our products. We rely on materials, components and finished goods that are sourced from or manufactured outside the U.S., including Mexico, China and other countries, and these countries may experience political or trade instability, which could disrupt our supply of products or materials. We rely on our suppliers to produce high quality materials, components and finished goods according to our specifications. Although we have quality control procedures in place, there is a risk that products may not meet our specifications which could impact our ability to ship quality products to our customers on a timely basis.

Our Thermal Management segment’s dependence on subcontractors and third party suppliers and manufacturers with respect to projects could have a material adverse effect on us.

Our Thermal Management segment often relies on third party subcontractors as well as third party suppliers and manufacturers to complete projects. To the extent that we cannot engage subcontractors or acquire supplies or materials from third parties for these projects, our ability to complete a project in a timely fashion or at a profit may be impaired. If the amount we are required to pay for these goods and services exceeds the amount we have estimated in bidding for fixed-price contracts, we could experience losses on these contracts. In addition, if a subcontractor, supplier or manufacturer is unable to deliver its services or materials according to the negotiated contract terms for any reason, including the deterioration of its financial condition or over-commitment of its resources, we may be required to purchase the services or materials from another source at a higher price. This may reduce the profit to be realized or result in a loss on a project for which the services or materials were needed.

Intellectual property challenges may hinder our ability to develop, engineer and market our products, and we may incur significant costs in our efforts to successfully avoid, manage, defend and litigate intellectual property matters.

Patents, non-compete agreements, proprietary technologies, customer relationships, trademarks, trade names and brand names are important to our business. Intellectual property protection, however, may not preclude competitors from developing products similar to ours or from challenging our names or products. Our pending patent applications, and our pending copyright and trademark registration applications, may not be allowed or competitors may challenge the validity or scope of our patents, copyrights or trademarks. In addition, our patents, copyrights, trademarks and other intellectual property rights may not provide us a significant competitive advantage. Over the past few years, we have noticed an increasing tendency for participants in our markets to use challenges to intellectual property as a means to compete. Patent and trademark challenges increase our costs to develop, engineer and market our products. We may need to spend significant resources monitoring our intellectual property rights and we may or may not be able to detect infringement by third parties. If we fail to successfully enforce our intellectual property rights or register new patents, our competitive position could suffer, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

From time to time, we receive notices from third parties alleging intellectual property infringement. Any dispute or litigation involving intellectual property could be costly and time-consuming due to the complexity and the uncertainty of intellectual property litigation. Our intellectual property portfolio may not be useful in asserting a counterclaim, or negotiating a license, in response to a claim of infringement or misappropriation. In addition, as a result of such claims, we may lose our rights to utilize critical technology, may be required to pay substantial damages or license fees with respect to the infringed rights or may be required to redesign our products at a substantial cost, any of which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Changes in U.S. and foreign government administrative policy, including changes to existing trade agreements and U.S government sanctions, could have a material adverse effect on us.

As a result of changes to U.S. and foreign government administrative policy, there may be changes to existing trade agreements, greater restrictions on free trade generally, significant increases in tariffs on goods imported into the U.S. particularly tariffs on products manufactured in China, Canada and Mexico, among other possible changes.

In addition, from time to time, the U.S. government has imposed sanctions restricting U.S. companies from conducting business with specified non-U.S. individuals and companies. In particular, the U.S. government has imposed sanctions through several executive orders and legislation restricting U.S. companies from conducting business with specified Russian and Ukrainian individuals and companies. While we believe that the executive orders currently do not preclude us from conducting business with our current customers or vendors in Russia, the sanctions imposed by the U.S. government may be expanded in the future to restrict us from engaging with them. If we are unable to conduct business with new or existing customers or vendors or pursue business opportunities in Russia or Ukraine, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Changes in U.S. social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently manufacture and sell products, and any resulting negative sentiments towards the U.S. as a result of such changes, could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We have significant goodwill and intangible assets and future impairment of our goodwill and intangible assets could have a material adverse effect on our results of operations.

We test goodwill and other indefinite-lived intangible assets for impairment on at least an annual basis, and more frequently if circumstances warrant, by comparing the estimated fair value of our reporting unit to its respective carrying values on its balance sheets. As of December 31, 2019, our goodwill and intangible assets were $3.4 billion and represented 74% of our total assets. Changes in economic and operating conditions impacting the assumptions used in our impairment tests could result in future goodwill and intangible asset impairment charges.

We are exposed to potential environmental laws, liabilities and litigation.

We are subject to U.S. federal, state, local and non-U.S. laws and regulations governing our environmental practices, public and worker health and safety, and the indoor and outdoor environment. Compliance with these environmental, health and safety regulations could require us to satisfy environmental liabilities, increase the cost of manufacturing our products or otherwise have a material adverse effect on our business, financial condition, results of operations and cash flows. Any violations of these laws by us could cause us to incur unanticipated liabilities. We are also required to comply with various environmental laws and maintain permits, some of which are subject to renewal from time to time, for many of our businesses and we could suffer if we are unable to renew existing permits or to obtain any additional permits that we may require. Compliance with environmental requirements also could require significant operating or capital expenditures or result in significant operational restrictions. We cannot assure you that we have been or will be at all times in compliance with environmental and health and safety laws. If we violate these laws, we could be fined, criminally charged or otherwise sanctioned by regulators.

In addition to clean-up actions brought by governmental authorities, private parties could bring personal injury or other claims due to the presence of, or exposure to, hazardous substances. Certain environmental laws impose liability on current or previous owners or operators of real property for the cost of removal or remediation of hazardous substances at their properties or at properties at which they have disposed of hazardous substances. The cost of clean-up and other environmental liabilities can be difficult to accurately predict. In addition, environmental requirements change and tend to become more stringent over time. Our eventual environmental clean-up costs and liabilities could exceed the amount of our current reserves.

We are exposed to certain regulatory and financial risks related to climate change.

Climate change is receiving ever increasing attention worldwide. Many scientists, legislators and others attribute global warming to increased levels of greenhouse gases, which has led to significant legislative and regulatory efforts to limit greenhouse gas emissions. The U.S. Environmental Protection Agency ("EPA") has published findings that emissions of carbon dioxide, methane, and other greenhouse gases ("GHGs") present an endangerment to public health and the environment because emissions of such gases are, according to the EPA, contributing to the warming of the earth's atmosphere and other climate changes. Based on these findings, the EPA has implemented regulations that require reporting of GHG emissions, or that limit emissions of GHGs from certain mobile or stationary sources. In addition, the U.S. Congress and federal and state regulatory agencies have considered other legislation and regulatory proposals to reduce emissions of GHGs, and many states have already taken legal measures to reduce emissions of GHGs, primarily through the development of GHG inventories, GHG permitting and/or regional GHG cap-and-trade programs. It is uncertain whether, when and in what form a federal mandatory carbon dioxide emissions reduction program, or other state programs, may be adopted. Similarly, certain countries have adopted the Kyoto Protocol and/or the Paris Accord, and these and other existing international initiatives or those under consideration could affect our international operations. To the extent our customers, particularly our energy and industrial customers, are subject to any of these or other similar proposed or newly enacted laws and regulations, we are exposed to risks that the additional costs incurred by customers to comply with such laws and regulations could impact their ability or desire to continue to operate at similar levels in certain jurisdictions as historically seen or as currently anticipated, which could negatively impact their demand for our products and services. These actions could also increase costs associated with our operations, including costs for raw materials and transportation. Because it is uncertain what laws will be enacted, we cannot predict the potential impact of such laws on our future financial condition, results of operations and cash flows.

Increased information technology security threats and computer crime pose a risk to our systems, networks, products and services, and we are exposed to potential regulatory, financial and reputational risks relating to the protection of our data.

We rely upon information technology systems and networks in connection with a variety of business activities, some of which are managed by third parties. Additionally, we collect and store data that is sensitive to us and our employees, customers, distributors and suppliers. As our business increasingly interfaces with employees, customers, distributors and suppliers using information technology systems and networks, we are subject to an increased risk to the secure operation of these systems and networks and to additional laws and regulatory requirements regarding data privacy, including the European Union General Data Protection Regulation. The secure operation of these information technology systems and networks, and the processing and maintenance of this data is critical to our business operations and strategy. Information technology security threats are increasing in frequency and sophistication. These threats pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of the data we process and maintain and pose a risk of theft to our assets. Establishing systems and processes to address these threats and changes in legal requirements relating to data collection and storage may increase our costs. We have experienced data breaches, and, although we have determined such data breaches to be immaterial and such data breaches have not had a material adverse effect on our financial condition, results of operations or cash flows, there can be no assurance of similar results in the future. Should future attacks succeed in the theft of assets, exporting sensitive data or financial information or controlling sensitive systems or networks, it could expose us and our employees, customers, distributors and suppliers to the theft of assets, misuse of information or systems, the compromising of confidential information, manipulation and destruction of data, defective products, production downtimes and operations disruptions, and breach of privacy, which may require notification under data privacy and other applicable laws. The occurrence of any of these events could have a material adverse effect on our reputation, business, financial condition, results of operations and cash flows. In addition, such breaches in security could result in litigation, regulatory action and potential liability and the costs and operational consequences of implementing further data protection measures.

We may be negatively impacted by litigation, including product liability claims.

Our business exposes us to potential litigation, such as product liability claims relating to the design, manufacture and sale of our products. While we currently maintain what we believe to be suitable product liability insurance, we may not be able to maintain this insurance on acceptable terms and this insurance may not provide adequate protection against potential or previously existing liabilities. In addition, we self-insure a portion of product liability claims. Successful claims against us for significant amounts could have a material adverse effect on our product reputation, business, financial condition, results of operations and cash flows.

Our share price may fluctuate significantly.

We cannot predict the prices at which nVent ordinary shares may trade. The market price of nVent ordinary shares may fluctuate widely, depending on many factors, some of which may be beyond our control, including:


•	actual or anticipated fluctuations in our results of operations due to factors related to our business;


•	success or failure of our business strategy;


•	our quarterly or annual earnings, or those of other companies in our industry;


•	our ability to obtain third-party financing as needed;


•	announcements by us or our competitors of significant acquisitions or dispositions;


•	changes in accounting standards, policies, guidance, interpretations or principles;


•	changes in earnings estimates by us or securities analysts or our ability to meet those estimates;


•	the operating and share price performance of other comparable companies;


•	investors' perceptions of us;


•	natural or other environmental disasters that investors believe may affect us;


•	overall market fluctuations;


•	results from any material litigation, including government investigations or environmental liabilities;


•	changes in laws and regulations affecting our business; and


•	general economic conditions and other external factors.

Stock markets in general have experienced volatility that has often been unrelated to the operating performance of a particular company. These broad market fluctuations could have a material adverse effect on our share price.

Risks Relating to Being a Separate, Stand-Alone Company

Our historical financial information is not necessarily representative of the results that we would have achieved as a separate, publicly-traded company and may not be an accurate indicator of our future results of operations.

The historical information about us prior to April 30, 2018 in this Annual Report on Form 10-K refers to our business as operated by and integrated with Pentair. Our historical financial information for such periods was derived from the consolidated financial statements and accounting records of Pentair. Accordingly, such historical financial information included in this Annual Report on Form 10-K does not necessarily reflect the financial condition, results of operations or cash flows that we would have achieved as a separate, publicly-traded company during the periods presented or those that we will achieve in the future primarily as a result of the factors described below:

•

Prior to the separation, our business was operated by Pentair as part of its broader corporate organization, rather than as an independent company. Pentair or one of its affiliates performed various corporate functions for us, such as accounting, information technology and finance. Our historical financial results reflect allocations of corporate expenses from Pentair for such functions and may not reflect the expenses we would have incurred had we operated as a separate, publicly-traded company. As a result of the separation, we are responsible for the additional costs associated with being an independent, publicly traded company, including costs related to corporate governance and external reporting.

•

Generally, our working capital and capital for our general corporate purposes have historically been provided as part of the corporate-wide cash management policies of Pentair. As a stand-alone company, we may need to obtain additional financing from lenders, through public offerings or private placements of debt or equity securities, strategic relationships and the cost of capital for our business may be higher than Pentair’s cost of capital prior to completion of the separation.

Other significant changes may occur in our cost structure, management, financing and business operations as a result of operating as a company separate from Pentair. For additional information about the past financial performance of our business and the basis of presentation of the historical combined financial statements of our business, see ITEM 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and ITEM 8, “Financial Statements and Supplementary Data.”

Potential indemnification liabilities to Pentair pursuant to the transaction agreements could materially adversely affect us.

In connection with the separation, we entered into a separation and distribution agreement and various other agreements, including a tax matters agreement, a transition services agreement and an employee matters agreement with Pentair. The separation and distribution agreement with Pentair contains, among other things, provisions governing the relationship between us and Pentair with respect to and resulting from the separation. Among other things, the separation agreement provides for indemnification obligations designed to make us financially responsible for substantially all liabilities that may exist relating to its business activities, whether incurred prior to or after the separation. We may be subject to substantial liabilities under these indemnifications.

If the distribution fails to qualify as a tax-free transaction for U.S. federal income tax purposes, then we and our shareholders could be subject to significant tax liability or tax indemnity obligations.

Pentair received an IRS Ruling from the IRS substantially to the effect that, among other things, the distribution and certain related transactions qualify as tax-free under Section 355 and related provisions of the Code. The tax-free nature of the distribution was conditioned on the continued validity of the IRS Ruling, as well as on receipt of a tax opinion, substantially to the effect that, among other things, the distribution would qualify as a tax-free transaction under Section 355 and related provisions of the Code, and certain transactions related to the transfer of assets and liabilities to us in connection with the separation and distribution would not result in the recognition of any gain or loss to Pentair, us or our shareholders. The IRS ruling and the tax opinion relied on certain facts and assumptions, certain representations from Pentair and us regarding the past and future conduct of both businesses and other matters, and the tax opinion relies on the IRS Ruling. Notwithstanding the IRS ruling and tax opinion, the IRS could determine on audit that the distribution should be treated as a taxable transaction if it determines that any of these facts, assumptions, representations or undertakings is not correct or has been violated, or that the distribution should be taxable for other reasons, including as a result of a significant change in stock or asset ownership after the distribution, or if the IRS were to disagree with the conclusions of the tax opinion that are not covered by the IRS ruling. If the distribution is ultimately determined to be taxable, the distribution could be treated as a taxable dividend to you for U.S. federal income tax purposes, and you could incur significant U.S. federal income tax liability. In addition, Pentair and/or we could incur significant U.S. federal income tax liabilities or tax indemnification obligations, whether under applicable law or the tax matters agreement that we entered into with Pentair, if it is ultimately determined that certain related transactions undertaken in anticipation of the distribution are taxable. To the extent we incur any tax liability or indemnification obligation under applicable law or the tax matters agreement, there could be a material adverse effect on our business, financial condition, and results of operations and cash flows in future reporting periods.

We might not be able to engage in desirable strategic transactions and equity issuances following the distribution because of restrictions relating to U.S. federal income tax requirements for tax-free distributions.

Our ability to engage in significant equity transactions could be limited or restricted after the distribution in order to preserve, for U.S. federal income tax purposes, the tax-free nature of the distribution by Pentair. Even if the distribution otherwise qualifies for tax-free treatment under Section 355 of the Code, it may result in corporate-level taxable gain to Pentair and certain of its affiliates under Section 355(e) of the Code if 50 percent or more, by vote or value, of nVent ordinary shares or Pentair ordinary shares are acquired or issued as part of a plan or series of related transactions that includes the distribution. Any acquisitions or issuances of nVent ordinary shares or Pentair ordinary shares within two years after the distribution will generally be presumed to be part of such a plan, although we or Pentair may be able to rebut that presumption. To preserve the tax-free treatment to Pentair of the distribution, under the tax matters agreement, we expect that we will be prohibited from taking or failing to take any action that prevents the distribution and related transactions from being tax-free. Further, for the two-year period following the distribution, without obtaining the consent of Pentair, a private letter ruling from the IRS or an unqualified opinion of a nationally recognized law firm or accounting firm, we may be prohibited from, among other things:


•	approving or allowing any transaction that results in a change in ownership of more than a specified percentage of nVent ordinary shares when combined with any other changes in ownership of nVent ordinary shares,


•	redeeming or repurchasing equity securities,


•	selling or otherwise disposing of substantially all of our assets, or


•	engaging in certain internal transactions.

These restrictions may limit our ability to pursue strategic transactions or engage in new business or other transactions that may maximize the value of our business. Moreover, the tax matters agreement also provides that we are responsible for all or a specified portion of any taxes imposed on Pentair or any of its affiliates as a result of the failure of the distribution or the internal transactions to qualify for favorable treatment under the Code unless such failure is attributable to certain actions taken after the distribution by Pentair.

Risks Relating to Our Liquidity

Disruptions in the financial markets could adversely affect us, our customers and our suppliers by increasing funding costs or reducing availability of credit.

In the normal course of our business, we may access credit markets for general corporate purposes, which may include repayment of indebtedness, acquisitions, additions to working capital, repurchase of shares, capital expenditures and investments in our subsidiaries. Although we expect to have sufficient liquidity to meet our foreseeable needs, our access to and the cost of capital could be negatively impacted by disruptions in the credit markets, which have occurred in the past and made financing terms for borrowers unattractive or unavailable. These factors may make it more difficult or expensive for us to access credit markets if the need arises. In addition, these factors may make it more difficult for our suppliers to meet demand for their products or for prospective customers to commence new projects, as customers and suppliers may experience increased costs of debt financing or difficulties in obtaining debt financing. Disruptions in the financial markets in the past have had adverse effects on other areas of the economy and have led to a slowdown in general economic activity that may adversely affect our businesses. One or more of these factors could adversely affect our business, financial condition, results of operations and cash flows.

Covenants in our debt instruments may adversely affect us.

Our credit agreements and indentures contain customary financial covenants, including those that limit the amount of our debt, which may restrict the operations of our business and our ability to incur additional debt to finance acquisitions. Our ability to meet the financial covenants can be affected by events beyond our control, and we cannot provide assurance that we will meet those tests. A breach of any of these covenants could result in a default under our credit agreements or indentures. Upon the occurrence of an event of default under any of our credit facilities or indentures, the lenders or trustees could elect to declare all amounts outstanding thereunder to be immediately due and payable and, in the case of credit facility lenders, terminate all commitments to extend further credit. If the lenders or trustees accelerate the repayment of borrowings, we cannot provide assurance that we will have sufficient assets to repay our credit facilities and our other indebtedness. Furthermore, acceleration of any obligation under any of our material debt instruments will permit the holders of our other material debt to accelerate their obligations, which could have a material adverse effect on our financial condition.

Our indebtedness, and any future increase in debt or raising of additional capital, could affect our financial condition, and may decrease our profitability.

As of December 31, 2019, we had $1.1 billion of total debt outstanding. If we are not able to repay or refinance our debt as it becomes due, we may be forced to sell assets or take other disadvantageous actions, including (i) reducing financing in the future for working capital, capital expenditures and general corporate purposes or (ii) dedicating an unsustainable level of our cash flow from operations to the payment of principal and interest on our indebtedness. The lenders who hold such debt could also accelerate amounts due, which could potentially trigger a default or acceleration of any of our other debt.

Further, we may increase our debt or raise additional capital in the future, subject to restrictions in our debt agreements. If our cash flow from operations is less than we anticipate, if our cash requirements are more than we expect, or if we intend to finance acquisitions, we may require more financing. However, debt or equity financing may not be available to us on acceptable terms, if at all. If we incur additional debt or raise equity through the issuance of additional capital shares, the terms of the debt or capital shares issued may give the holders rights, preferences and privileges senior to those of holders of our ordinary shares, particularly in the event of liquidation. The terms of the debt may also impose additional and more stringent restrictions on our operations than we currently have. If we raise funds through the issuance of additional equity, the percentage ownership of existing shareholders in our company would decline. If we are unable to raise additional capital when needed, our financial condition could be adversely affected. Unfavorable changes in the ratings that rating agencies assign to our debt may ultimately negatively impact our access to the debt capital markets and increase the costs we incur to borrow funds. If ratings for our debt are downgraded, our access to the debt capital markets may become restricted. Additionally, our credit agreements generally include an increase in interest rates if the ratings for our debt are downgraded.

Risks Relating to Our Jurisdiction of Incorporation in Ireland and Tax Residency in the U.K.

We are subject to changes in law and other factors that may not allow us to maintain a worldwide effective corporate tax rate that is competitive in our industry.

While we believe that we should be able to maintain a worldwide effective corporate tax rate that is competitive in our industry, we cannot give any assurance as to what our effective tax rate will be in the future, because of, among other things, uncertainty regarding the tax policies of the jurisdictions where we operate. Our actual effective tax rate may vary from our expectation and that variance may be material. Also, the tax laws of the U.S., the U.K., Ireland and other jurisdictions could change in the future, and such changes could cause a material change in our worldwide effective corporate tax rate. In particular, legislative action could be taken by the U.S., the U.K., Ireland or the European Union which could override tax treaties or modify tax statutes or regulations upon which we expect to rely and adversely affect our effective tax rate. We cannot predict the outcome of any specific legislative proposals. If proposals were enacted that had the effect of disregarding our incorporation in Ireland or limiting our ability as an Irish company to maintain tax residency in the U.K. and take advantage of the tax treaties among the U.S., the U.K. and Ireland, we could be subject to increased taxation, which could materially adversely affect our financial condition, results of operations, cash flows or our effective tax rate in future reporting periods.

A change in our tax residency could have a negative effect on our future profitability, and may trigger taxes on dividends or exit charges.

We are incorporated in Ireland and we are an Irish tax resident under Irish domestic law unless we are regarded as being resident elsewhere (and not Ireland) under the terms of a double tax treaty. Under domestic U.K. law, a company that is centrally managed and controlled in the U.K. is regarded as resident in the U.K. for taxation purposes unless it is treated as resident in another jurisdiction pursuant to any appropriate double tax treaty with the U.K. Other jurisdictions may also seek to assert taxing jurisdiction over us.

Effective for tax periods beginning on or after November 1, 2019, where a company is treated as tax resident under the domestic laws of both the U.K. and Ireland, the Double Tax Convention between the U.K. and Ireland (the “Convention”) signed on June 2, 1976, and as modified by paragraph 1 of Article 4 of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the “Multilateral Instrument” or “MLI”) provides that the residence of a dual-resident entity should be determined by way of mutual agreement between the Irish Revenue Commissioners and Her Majesty’s Revenue Commissioners. The tie-breaker test provides that, in cases of dual residence, the competent authorities of the two states shall determine by mutual agreement the territory of which the person shall be deemed to be resident for purposes of the Convention.

Our application under the Mutual Agreement Procedure provided for in Article 24 of the Convention (as amended pursuant to the MLI) seeking confirmation that we will continue to be tax resident solely in the U.K. was approved by the competent authorities of the U.K. and Ireland effective December 31, 2019.

It is possible that in the future, whether as a result of a change in law or the practice of any relevant tax authority or as a result of any change in the conduct of our affairs, we could become, or be regarded as having become, resident in a jurisdiction other than the U.K. If we cease to be resident in the U.K. and become resident in another jurisdiction, we may be subject to U.K. exit charges, and could become liable for additional tax charges in the other jurisdiction (including dividend withholding taxes or corporate income tax charges). If we were to be treated as resident in more than one jurisdiction, we could be subject to taxation in multiple jurisdictions. If, for example, we were considered to be a tax resident of Ireland, we could become liable for Irish corporation tax and any dividends paid by us could be subject to Irish dividend withholding tax.

Legislative action in the U.S. could materially adversely affect us.

Legislative or administrative action may be taken by the U.S. Congress or U.S. Treasury which, if ultimately enacted or finalized, could limit the availability of tax benefits or deductions that we currently claim, override tax treaties upon which we rely, or otherwise affect the taxes that the U.S. imposes on our worldwide operations. Such changes could materially adversely affect our effective tax rate and/or require us to take further action, at potentially significant expense, to seek to preserve our effective tax rate.

Irish law differs from the laws in effect in the U.S. and may afford less protection to holders of our securities.

It may not be possible to enforce court judgments obtained in the U.S. against us in Ireland based on the civil liability provisions of the U.S. federal or state securities laws. In addition, there is some uncertainty as to whether the courts of Ireland would recognize or enforce judgments of U.S. courts obtained against us or our directors or officers based on the civil liabilities provisions of the U.S. federal or state securities laws or hear actions against us or those persons based on those laws. We have been advised that the U.S. currently does not have a treaty with Ireland providing for the reciprocal recognition and enforcement of judgments in civil and commercial matters. Therefore, a final judgment for the payment of money rendered by any U.S. federal or state court based on civil liability, whether or not based solely on U.S. federal or state securities laws, would not automatically be enforceable in Ireland.

As an Irish company, we are governed by the Irish Companies Act, which differs in some material respects from laws generally applicable to U.S. corporations and shareholders, including, among others, differences relating to interested director and officer transactions and shareholder lawsuits. Likewise, the duties of directors and officers of an Irish company generally are owed to the company only. Shareholders of Irish companies generally do not have a personal right of action against directors or officers of the company and may exercise such rights of action on behalf of the company only in limited circumstances. Accordingly, holders of our securities may have more difficulty protecting their interests than would holders of securities of a corporation incorporated in a jurisdiction of the U.S.

In addition, our articles of association provide that the Irish courts have exclusive jurisdiction to determine any and all derivative actions in which a holder of nVent ordinary shares asserts a claim in the name of nVent, actions asserting a claim of breach of a fiduciary duty of any of the directors of nVent and actions asserting a claim arising pursuant to any provision of Irish law or our articles of association. Under Irish law, the proper claimant for wrongs committed against nVent, including by our directors, is considered to be nVent itself. Irish law permits a shareholder to initiate a lawsuit on behalf of a company such as nVent only in limited circumstances and requires court permission to do so.

Transfers of nVent ordinary shares may be subject to Irish stamp duty.

Transfers of nVent ordinary shares effected by means of the transfer of book entry interests in the Depository Trust Company ("DTC") will not be subject to Irish stamp duty. However, if you hold your nVent ordinary shares directly, rather than beneficially through DTC, any transfer of your nVent ordinary shares could be subject to Irish stamp duty (currently at the rate of 1 percent of the higher of the price paid or the market value of the shares acquired). Payment of Irish stamp duty is generally a legal obligation of the transferee.

We currently intend to pay (or cause one of our affiliates to pay) stamp duty in connection with share transfers made in the ordinary course of trading by a seller who holds shares directly to a buyer who holds the acquired shares beneficially. In other cases we may, in our absolute discretion, pay (or cause one of our affiliates to pay) any stamp duty. Our constitution provides that, in the event of any such payment, we (i) may seek reimbursement from the buyer, (ii) will have a lien against the shares acquired by such buyer and any dividends paid on such shares and (iii) may set-off the amount of the stamp duty against future dividends on such shares. Parties to a share transfer may assume that any stamp duty arising in respect of a transaction in nVent ordinary shares has been paid unless one or both of such parties is otherwise notified by us.

nVent ordinary shares, received by means of a gift or inheritance, could be subject to Irish capital acquisitions tax.

Irish capital acquisitions tax (“CAT”) could apply to a gift or inheritance of nVent ordinary shares irrespective of the place of residence, ordinary residence or domicile of the parties. This is because nVent ordinary shares will be regarded as property situated in Ireland. The person who receives the gift or inheritance has primary liability for CAT. Gifts and inheritances passing between spouses are exempt from CAT. Children have a tax-free threshold which Irish Revenue typically updates annually in respect of taxable gifts or inheritances received from their parents.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

Our principal office is located in leased premises in London, United Kingdom, and our management office in the United States is located in leased premises in Minneapolis, Minnesota.

Our operations are conducted in facilities throughout the world. These facilities house manufacturing and distribution operations, as well as sales and marketing, engineering and administrative offices. The following is a summary of our principal properties, including manufacturing, distribution, sales offices, and services centers:



	Number of Facilities
	Manufacturing Plants in the U.S.	Manufacturing Plants Outside the U.S.	Sales Offices	Distribution Facilities	Service Centers
Enclosures	3	11 located in 9 other countries	22	13	—
Thermal Management	1	3 located in 2 other countries	34	10	2
Electrical & Fastening Solutions	4	2 located in 2 other countries	3	6	—

We believe that our production facilities are suitable for their purpose and are adequate to support our businesses.

ITEM 3. LEGAL PROCEEDINGS

We have been made parties to a number of actions filed or have been given notice of potential claims relating to the conduct of our business, including those pertaining to commercial disputes, product liability, asbestos, environmental, safety and health, patent infringement and employment matters.

While we believe that a material impact on our financial position, results of operations or cash flows from any such future claims or potential claims is unlikely, given the inherent uncertainty of litigation, a remote possibility exists that a future adverse ruling or unfavorable development could result in future charges that could have a material adverse impact. We do and will continue to periodically reexamine our estimates of probable liabilities and any associated expenses and receivables and make appropriate adjustments to such estimates based on experience and developments in litigation. As a result, the current estimates of the potential impact on our financial position, results of operations and cash flows for the proceedings and claims described in the notes to our consolidated and combined financial statements could change in the future.

Environmental matters

We have been named as defendant, target or a potentially responsible party ("PRP") in a number of environmental clean-ups relating to our current or former business units. We may be named as a PRP at other sites in the future for existing business units, as well as both divested and acquired businesses. In addition to clean-up actions brought by governmental authorities, private parties could bring personal injury or other claims due to the presence of, or exposure to, hazardous substances.

Certain environmental laws impose liability on current or previous owners or operators of real property for the cost of removal or remediation of hazardous substances at their properties or at properties at which they have disposed of hazardous substances. Our accruals for environmental matters are recorded on a site-by-site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies. It can be difficult to estimate reliably the final costs of investigation and remediation due to various factors. In our opinion, the amounts accrued are appropriate based on facts and circumstances as currently known. As of December 31, 2019, our recorded reserves for environmental matters were not material. We do not anticipate these environmental conditions will have a material adverse effect on our financial position, results of operations or cash flows. However, unknown conditions, new details about existing conditions or changes in environmental requirements may give rise to environmental liabilities that will exceed the amount of our current reserves and could have a material adverse effect in the future.

Product liability claims

We are subject to various product liability lawsuits and personal injury claims. A substantial number of lawsuits and claims incurred prior to the effective date of the separation on April 30, 2018 are insured and accrued for by the former Parent’s captive insurance subsidiary. Lawsuits and claims incurred after the separation are insured and accrued for by Tonka Bay, a captive insurance subsidiary of nVent. For all other claims, accruals covering the claims are recorded, on an undiscounted basis, when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated based on existing information. The accruals are adjusted periodically as additional information becomes available. We have not experienced significant unfavorable trends in either the severity or frequency of product liability lawsuits or personal injury claims.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

The following table sets forth information as of December 31, 2019 regarding current executive officers of nVent Electric plc, their ages, current position and their business experience during at least the past five years are as follows:



Name	Age	Current Position and Business Experience
Beth A. Wozniak	55	Chief Executive Officer since 2018; Ms. Wozniak was the President of Pentair’s Electrical segment during 2017. Ms. Wozniak previously served as President of Pentair’s Flow & Filtration Solutions Global Business Unit from 2015 – 2016. Ms. Wozniak was President of the Environmental and Combustion Controls unit of Honeywell International Inc. (a software-industrial company) from 2011 – 2015 and President of the Sensing and Controls Unit of Honeywell International Inc. from 2006 – 2011, and she held various leadership positions at Honeywell International Inc. and its predecessor AlliedSignal Inc. from 1990 – 2006.
Sara E. Zawoyski	45	Executive Vice President and Chief Financial Officer since 2019; Ms. Zawoyski was the Senior Vice President Finance and Treasurer of the Company from 2018 – 2019. Ms. Zawoyski previously served in the following roles at Pentair and its predecessors: Chief Financial Officer, Electrical Segment from 2017 – 2018, Chief Financial Officer, Flow and Filtration Solutions from 2015 – 2017, Chief Financial Officer Flow Technologies from 2014 – 2015, Chief Financial Officer, Equipment Protection from 2012 – 2014, and Vice President Investor Relations from 2010 – 2012. Ms. Zawoyski also previously held various investor relations and managerial finance leadership positions at PepsiAmericas from 2002 – 2010 and various positions in the audit practice of PricewaterhouseCoopers LLP from 1996 – 2002.
Jon D. Lammers	55	Executive Vice President, General Counsel and Secretary since 2018; Mr. Lammers served as Pentair's General Counsel, Electrical from 2017-2018 and was an attorney at Foulston Siefkin LLP (a Kansas-based law firm) from 2016 – 2017. Mr. Lammers previously served as Senior Vice President, General Counsel and Secretary of Spirit Aerosystems Holdings, Inc. (a designer and manufacturer of aerostructures) from 2012 – 2016. He held various senior legal roles, including Deputy North American General Counsel and Asia Pacific General Counsel with Cargill Inc. from 1997 – 2012. Prior to his corporate experience, Mr. Lammers practiced law at Oppenheimer, Wolff & Donnelly (n/k/a Fox Rothschild LLP) from 1993 – 1997 and Paul Hastings LLP from 1991 – 1993.
Elizabeth C. Noonan	60	Executive Vice President, Chief Growth Officer since 2019; Ms. Noonan was the Chief Marketing Officer at Cree Inc. (a publicly traded manufacturer in the global lighting industry) from 2014 – 2019. Ms. Noonan previously held various leadership roles, including Chief Marketing Officer, with Panasonic Corporation North America from 2011 – 2014 and the Eastman Kodak Company from 1986 – 2011.
Lynnette R. Heath	52	Executive Vice President and Chief Human Resources Officer since 2018; Ms. Heath was the Senior Vice President, Global Human Resources of Entrust Datacard (a privately held global security and identity company) from 2009 – 2017. Ms. Heath previously held various human resources roles with General Electric Company from 2000 – 2009, with McKesson Corporation from 1996 – 2000 and with Northern States Power Company (n/k/a Xcel Energy Inc.) from 1992 – 1996.
Aravind Padmanabhan	51	Executive Vice President and Chief Technology Officer since 2019; Mr. Padmanabhan was the Vice President and Chief Technology Officer of the Honeywell Connected Worker unit of Honeywell International Inc. (a software-industrial company) from 2018 – 2019, and served as Acting Chief Architect of the Honeywell Sentience Platform in 2018. Mr. Padmanabhan previously served as Vice President and Chief Technology Officer of the Home & Building Technologies unit of Honeywell International Inc. from 2016 – 2018 and the Environmental & Energy Solutions unit of Honeywell International Inc. from 2013 – 2016. Mr. Padmanabhan also previously held various other technology and engineering leadership positions at Honeywell International Inc. from 1997 – 2013.
Randolph A. Wacker	55	Senior Vice President and Chief Accounting Officer since 2018 and Treasurer since 2019; Mr. Wacker was the Assistant Corporate Controller of Pentair and served in that role from 2005-2017. Mr. Wacker served as the U.S. Controller of Computer Network Technologies from 2004 – 2005. He served over 10 years in corporate controlling and external reporting roles in various public companies. Mr. Wacker also served as an accountant with the public accounting firm Larson, Allen, Weishair & Co., LLP (n/k/a CliftonLarsonAllen) from 1988 – 1993.



Joseph A. Ruzynski	44	President of Enclosures since 2018; Mr. Ruzynski was the Vice President of Pentair’s Enclosures Strategic Business Unit and served in that role during 2017. Mr. Ruzynski previously served as Vice President of Pentair’s Engineered Projects Strategic Business Group in its Valves & Controls Global Business Unit from 2016 – 2017 and Vice President of Pentair’s Fluid Motion Business Group from 2015 – 2016. He was the Vice President, Operations of Pentair’s Equipment Protection and Technical Solutions Global Business Units from 2012 – 2014, and held various supply leadership positions with Pentair from 2003 – 2012. Mr. Ruzynski was a Manager with Ernst & Young from 1997 – 2003.
Michael B. Faulconer	50	President of Thermal Management since 2018; Mr. Faulconer was the Vice President of Pentair’s Thermal Management Strategic Business Unit of the Electrical segment and served in that role during 2017. Mr. Faulconer previously served as the Vice President of Pentair’s Thermal Building Solutions Unit from 2014 – 2016. He was the Vice President, Marketing of Pentair’s Thermal Management Unit from 2010 – 2013. Mr. Faulconer held various general management and marketing leadership roles with Tyco Thermal Controls in the U.S. and Asia from 2001 – 2010. From 1991 – 2000, Mr. Faulconer held various sales roles with Valquip Corporation.
Robert J. van der Kolk	51	President of Electrical & Fastening Solutions since 2018; Mr. van der Kolk was the Vice President of Pentair’s Engineered & Fastening Solutions Strategic Business Unit of the Electrical segment and served in that role from 2015 – 2017. Mr. van der Kolk previously served as the Executive Vice President, Sales for ERICO from 2011 – 2015, and held various sales, development, and manufacturing leadership roles with ERICO from 2001 – 2008. Mr. van der Kolk held Plant Superintendent and Production Management roles for Cargill in the Netherlands and Germany from 1993 – 2001.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our ordinary shares are listed for trading on the New York Stock Exchange and trade under the symbol "NVT." As of December 31, 2019, there were 14,596 shareholders of record.

The timing, declaration and payment of future dividends to holders of our ordinary shares will depend upon many factors, including our financial condition and results of operations, the capital requirements of our businesses, industry practice and any other relevant factors.

Share Performance Graph

The following information under the caption "Share Performance Graph" in this ITEM 5 of this Annual Report on Form 10-K is not deemed to be "soliciting material" or to be "filed" with the Securities and Exchange Commission or subject to Regulation 14A or 14C under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or to the liabilities of Section 18 of the Exchange Act and will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent we specifically incorporate it by reference into such a filing.

The following graph sets forth the cumulative total shareholder return on our ordinary shares from the date of the separation of nVent from Pentair, assuming the investment of $100 on April 30, 2018 and the reinvestment of all dividends since that date to December 31, 2019. The graph also contains for comparison purposes the S&P Mid Cap 400 Index and the S&P Mid Cap 400 Industrials Index, assuming the same investment level and reinvestment of dividends. By virtue of our market capitalization, we are a component of the S&P Mid Cap 400 Index. On the basis of our size and diversity of businesses, we believe the S&P Mid Cap 400 Industrials Index is an appropriate published industry index for comparison purposes.



	Base Period 2018	INDEXED RETURNS Quarters ended
Company / Index	April 30	Q2 2018	Q3 2018	Q4 2018	Q1 2019	Q2 2019	Q3 2019	Q4 2019
nVent Electric plc	100	113.57	123.69	102.99	121.05	111.92	100.22	117.30
S&P Mid Cap 400 Index	100	104.23	107.86	88.82	101.27	103.90	103.37	110.18
S&P Mid Cap 400 Industrials Index	100	103.07	111.08	90.13	104.15	111.18	110.07	118.98

Purchases of Equity Securities

The following table provides information with respect to purchases we made of our ordinary shares during the fourth quarter of 2019:



	(a)	(b)		(c)	(d)
	Total number of shares purchased	Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs	Dollar value of shares that may yet be purchased under the plans or programs
October 1 – October 27, 2019	2,410	$	20.11	—	$	588,307,762
October 28 – November 24, 2019	648	20.36		—	588,307,762
November 25 – December 31, 2019	226	25.10		—	588,307,762
Total	3,284			—

(a)

The purchases in this column includes shares repurchased as part of our publicly announced plans and shares deemed surrendered to us by participants in the nVent Electric plc 2018 Omnibus Incentive Plan (the "2018 Plan") and earlier Pentair stock incentive plans that are now outstanding under the 2018 Plan (collectively the "Plans") to satisfy the exercise price or withholding of tax obligations related to the exercise of stock options, vesting of restricted shares and vesting of performance shares.


(b)	The average price paid in this column includes shares repurchased as part of our publicly announced plans and shares deemed surrendered to us by participants in the Plans to satisfy the exercise price of stock options and withholding tax obligations due upon stock option exercises, vesting of restricted shares and vesting of performance shares.


(c)	The number of shares in this column represents the number of shares repurchased as part of our publicly announced plans to repurchase our ordinary shares up to a maximum dollar limit authorized by the Board of Directors, discussed below.

(d)

In July 2018, our Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $500.0 million (the "2018 Authorization"). In February 2019, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $380.0 million (the "2019 Authorization"). The 2018 and 2019 Authorizations expire on July 23, 2021. As of December 31, 2019, we had $588.3 million available for repurchases under the combined 2018 and 2019 Authorizations.

ITEM 6. SELECTED FINANCIAL DATA

The selected historical consolidated and combined financial data presented below should be read in conjunction with the “Risk Factors” in ITEM 1A, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in ITEM 7, and our consolidated and combined financial statements and accompanying notes thereto in ITEM 8 of this Annual report on Form 10-K to fully understand factors that may affect the comparability of the information presented below.

For periods ended December 31, 2015 through 2017, and for the first four months of the year ended December 31, 2018, certain expenses of Pentair were allocated to nVent for certain support functions that were provided on a centralized basis prior to the separation from Pentair on April 30, 2018. As a result, the financial information included below may not necessarily reflect what nVent's financial position, results of operations and cash flows would have been had it been a stand-alone company during the periods presented.



	Years ended December 31
In millions, except per-share data	2019		2018		2017		2016		2015
Consolidated and combined statements of operations and comprehensive income data
Net sales	$	2,204.0	$	2,213.6	$	2,097.9	$	2,116.0	$	1,809.3
Income before income taxes	257.4		268.7		313.3		315.0		265.9
Net income	222.7		230.8		361.7		259.1		210.1
Per-share data
Basic:
Earnings per ordinary share	$	1.30	$	1.29	$	2.02	$	1.45	$	1.17
Weighted average shares ⁽¹⁾	171.6		178.6		179.0		179.0		179.0
Diluted:
Earnings per ordinary share	$	1.29	$	1.28	$	2.00	$	1.43	$	1.16
Weighted average shares ⁽¹⁾	173.0		180.8		181.2		181.2		181.2
Cash dividends declared and paid per ordinary share	$	0.70	$	0.35	$	—	$	—	$	—
Cash dividends declared and unpaid per ordinary share	0.175		0.175		—		—		—
Consolidated and combined balance sheets data
Total assets	$	4,640.3	$	4,552.7	$	4,725.0	$	4,493.8	$	4,564.4
Total debt	1,064.6		941.7		—		—		—
Total equity	2,592.5		2,687.1		3,791.3		3,485.7		3,506.7



⁽¹⁾	On April 30, 2018, Pentair completed the separation of its Electrical business, distributing to its shareholders one ordinary share of nVent for every ordinary share of Pentair held as of the record date of April 17, 2018. The computations of basic and diluted earnings per share for periods prior to the separation were calculated using the shares that were distributed to Pentair shareholders upon the separation.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management's Discussion and Analysis of Financial Condition and Results of Operations refers to and should be read in conjunction with the audited consolidated and combined financial statements and the corresponding notes included in ITEM 8.

Forward-looking statements

This report contains statements that we believe to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact are forward-looking statements. Without limitation, any statements preceded or followed by or that include the words "targets," "plans," "believes," "expects," "intends," "will," "likely," "may," "anticipates," "estimates," "projects," "should," "would," "positioned," "strategy," "future," "forecast" or words, phrases or terms of similar substance or the negative thereof, are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond our control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include; adverse effects on our business operations or financial results as a result of the consummation of the separation (as defined below); overall global economic and business conditions impacting our business; the ability to achieve the benefits of our restructuring plans; the ability to successfully identify, finance, complete and integrate acquisitions, including the acquisition of Eldon Holding AB ("Eldon"); competition and pricing pressures in the markets we serve, including the impacts of tariffs; volatility in currency exchange rates and commodity prices; inability to generate savings from excellence in operations initiatives consisting of lean enterprise, supply management and cash flow practices; increased risks associated with operating foreign businesses; the ability to deliver backlog and win future project work; failure of markets to accept new product introductions and enhancements; the impact of changes in laws and regulations, including those that limit U.S. tax benefits; the outcome of litigation and governmental proceedings; and the ability to achieve our long-term strategic operating goals. Additional information concerning these and other factors is contained in our filings with the U.S. Securities and Exchange Commission (the "SEC"), including this Annual Report on Form 10-K. All forward-looking statements speak only as of the date of this report. nVent Electric plc assumes no obligation, and disclaims any obligation, to update the information contained in this report.

The following is the discussion and analysis of changes in the financial condition and results of operations for fiscal year 2019 compared to fiscal year 2018. The discussion and analysis of fiscal year 2017 and changes in the financial condition and results of operations for fiscal year 2018 compared to fiscal year 2017 that are not included in this Form 10-K may be found in Part II, ITEM 7 of our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2018, filed with the SEC on March 1, 2019.

Overview

nVent is a leading global provider of electrical connection and protection solutions. We believe our inventive electrical solutions enable safer systems and ensure a more secure world. We design, manufacture, market, install, and service high performance products and solutions that connect and protect some of the world’s most sensitive equipment, buildings, and critical processes. We offer a comprehensive range of enclosures, electrical connections and fastening, and thermal management solutions across industry-leading brands that are recognized globally for quality, reliability, and innovation.

We classify our operations into business segments based primarily on types of products offered and markets served. We operate across three segments: Enclosures, Thermal Management, and Electrical & Fastening Solutions, which represented approximately 47%, 27% and 26% of total revenues during 2019, respectively.

•

Enclosures - The Enclosures segment provides inventive solutions that protect, connect and manage heat in critical electronics, communication, control, and power equipment. From metallic and non-metallic enclosures to cabinets, subracks and backplanes, it offers the physical infrastructure to host, connect and protect server and network equipment, as well as indoor and outdoor protection for test and measurement, aerospace and defense applications in industrial, infrastructure, energy and commercial verticals.

•

Thermal Management - The Thermal Management segment provides electric thermal solutions that connect and protect critical buildings, infrastructure, industrial processes and people. Its thermal management systems include heat tracing, floor heating, fire-rated and specialty wiring, sensing and snow melting and de-icing solutions for use in industrial, commercial & residential, energy and infrastructure verticals. It's highly reliable and easy to install solutions lower total cost of ownership to building owners, facility managers, operators and end users.

•

Electrical & Fastening Solutions - The Electrical & Fastening Solutions segment provides fastening solutions that connect and protect electrical and mechanical systems and civil structures. Its engineered electrical and fastening products are innovative cost efficient and labor saving connections that are used across a wide range of verticals, including commercial, industrial, infrastructure and energy.

On April 30, 2018, Pentair plc ("Pentair" or "former Parent") completed the separation of its Water business and its Electrical business into two independent, publicly-traded companies (the "separation"). To effect the separation, Pentair distributed to its shareholders one ordinary share of nVent for every ordinary share of Pentair held as of the record date of April 17, 2018. As a result of the distribution, nVent is now an independent publicly-traded company and began regular way trading under the symbol "NVT" on the New York Stock Exchange on May 1, 2018.

The Company was incorporated in Ireland on May 30, 2017. Although our jurisdiction of organization is Ireland, we manage our affairs so that we are centrally managed and controlled in the United Kingdom (the "U.K.") and have tax residency in the U.K.

On August 30, 2019, as part of our Enclosures segment, we completed the acquisition of Eldon for $127.8 million, net of cash acquired. Eldon is an innovative European-based manufacturer of enclosures that protect sensitive electrical, electronic and data and telecommunications components.

Key trends and uncertainties regarding our existing business

The following trends and uncertainties affected our financial performance in 2019 and 2018, and will likely impact our results in the future:

•

We have identified specific product, vertical and geographic market opportunities that we find attractive and continue to pursue, both within and outside the U.S. We are positioning our businesses to more effectively address these opportunities through research and development and additional sales and marketing resources. Unless we successfully penetrate these markets, our organic sales growth will likely be limited or may decline.

•

We have experienced material and other cost inflation. We strive for productivity improvements and we implement increases in selling prices to help mitigate this inflation. We expect the current economic environment, including the impacts of tariffs, will result in continuing price volatility for many of our raw materials and purchased components and we are uncertain as to the timing and impact of these market changes.


•	During 2019 and 2018, we continued execution of certain business restructuring initiatives aimed at reducing our fixed cost structure and realigning our business.

In 2020, our operating objectives include the following:


•	Achieving differentiated revenue growth through new products and solutions and vertical market expansion in key developing regions;


•	Driving operating excellence through lean enterprise initiatives, with specific focus on sourcing and supply management, cash flow management and lean operations;


•	Optimizing our technological capabilities to increasingly generate innovative new and connected products and advance digital transformation; and


•	Focusing on developing global talent in light of our global presence.

The financial statements for periods prior to April 30, 2018 were prepared on a stand-alone basis derived from the consolidated financial statements and records of the former Parent as if nVent had operated on a stand-alone basis.

For periods prior to the separation, the consolidated and combined financial statements of nVent include general corporate expenses of the former Parent for certain support functions that were provided on a centralized basis, such as expenses related to executive management, finance, audit, legal, information technology, human resources, communications, facilities and employee benefits and compensation. These general corporate expenses are included in the Consolidated and Combined Statements of Operations and Comprehensive Income within Selling, general and administrative expense and Other expense. These expenses were allocated to nVent on the basis of direct usage when identifiable, with the remainder allocated based on a proportional basis of net sales, headcount or other measures. nVent considers the allocation methodology regarding the former Parent’s general corporate expenses to be reasonable for periods presented prior to the separation. Nevertheless, the consolidated and combined financial statements of nVent for periods prior to the separation may not reflect the actual expenses that would have been incurred and may not reflect nVent’s consolidated and combined results of operations, financial position and cash flows had it been a stand-alone company during the periods presented.

CONSOLIDATED AND COMBINED RESULTS OF OPERATIONS

The consolidated and combined results of operations were as follows:



	Years ended December 31						% / point change
In millions	2019			2018			2019 vs 2018
Net sales	$	2,204.0		$	2,213.6		(0.4	%)
Cost of goods sold	1,338.2			1,337.5			0.1	%
Gross profit	865.8			876.1			(1.2	%)
% of net sales	39.3		%	39.6		%	(0.3	pts)

Selling, general and administrative	484.5			519.7			(6.8	%)
% of net sales	22.0		%	23.5		%	(1.5	pts)
Research and development	48.2			45.6			5.7	%
% of net sales	2.2		%	2.1		%	0.1	pts

Operating income	333.1			310.8			7.2	%
% of net sales	15.1		%	14.0		%	1.1	pts

Net interest expense	44.7			31.2			N.M.
Other expense	31.0			10.9			N.M.

Income before income taxes	257.4			268.7			(4.2	%)
Provision for income taxes	34.7			37.9			(8.4	%)
Effective tax rate	13.5		%	14.1		%	(0.6	pts)

N.M. Not Meaningful

Net sales

The components of the consolidated net sales change were as follows:



	2019 vs 2018
Volume	(1.9	%)
Price	1.7
Organic growth	(0.2	)
Acquisition	1.4
Currency	(1.6	)
Total	(0.4	%)

The 0.4 percent decrease in net sales in 2019 from 2018 was primarily the result of:


•	unfavorable foreign currency effects; and


•	slowdown in capital spending resulting in organic sales decline of approximately 1.5% contributed from our industrial business in 2019 from 2018.

This decrease was partially offset by:


•	sales of $30.6 million in 2019 as a result of the Eldon acquisition; and


•	organic sales growth contribution of approximately 1.0% from our commercial & residential business, which includes selective increases in selling prices.

Gross profit

The 0.3 percentage point decrease in gross profit as a percentage of sales in 2019 from 2018 was primarily the result of:


•	inflationary increases related to certain raw materials, labor and freight costs; and


•	sales volume decline resulting in decreased leverage on fixed expenses and cost of goods sold.

This decrease was partially offset by:


•	selective increases in selling prices to mitigate cost increases; and


•	savings generated from our lean and supply management practices.

Selling, general and administrative ("SG&A")

The 1.5 percentage point decrease in SG&A expense as a percentage of sales in 2019 from 2018 was driven by:


•	non-recurring separation costs of $45.0 million incurred in 2018 to prepare nVent to operate as an independent stand-alone public company; and


•	savings generated from restructuring and other lean initiatives.

This decrease was partially offset by:


•	restructuring and other costs of $24.2 million in 2019, compared to $7.7 million in 2018;


•	investment in sales and marketing to drive growth; and


•	inflationary increases impacting our labor costs.

Provision for income taxes

The 0.6 percentage point decrease in the effective tax rate in 2019 from 2018 was primarily due to:


•	the mix of global earnings towards lower tax rate jurisdictions.

SEGMENT RESULTS OF OPERATIONS

The summary that follows provides a discussion of the results of operations of our three reportable segments (Enclosures, Thermal Management and Electrical & Fastening Solutions). Each of these segments comprises various product offerings that serve multiple end markets.

We evaluate performance based on sales and segment income and use a variety of ratios to measure performance of our reporting segments. Segment income (loss) represents operating income exclusive of intangible amortization, separation costs, costs of restructuring activities, impairments and other unusual non-operating items.

Enclosures

The net sales and segment income for Enclosures were as follows:



	Years ended December 31						% / point change
In millions	2019			2018			2019 vs 2018
Net sales	$	1,033.8		$	1,019.7		1.4	%
Segment income	181.3			174.8			3.7	%
% of net sales	17.5		%	17.1		%	0.4	pts

Net sales

The components of the change in Enclosures net sales were as follows:



	2019 vs 2018
Volume	(1.8	%)
Price	1.5
Organic growth	(0.3	)
Acquisition	3.0
Currency	(1.3	)
Total	1.4	%

The 1.4 percent increase in Enclosures net sales in 2019 from 2018 was primarily the result of:


•	net sales of $30.6 million in 2019 as a result of the Eldon acquisition; and


•	organic sales growth contribution of approximately 1.0% from our commercial & residential business, which includes selective increases in selling prices.

This increase was partially offset by:


•	unfavorable foreign currency effects; and


•	slowdown in capital spending resulting in organic sales decline of approximately 1.0% contributed from our industrial business.

Segment income

The components of the change in Enclosures segment income as a percentage of net sales from the prior period were as follows:



	2019 vs 2018
Growth/acquisition	(0.7	pts)
Price	1.2
Currency	0.2
Net productivity	(0.3	)
Total	0.4	pts

The 0.4 percentage point increase in segment income for Enclosures as a percentage of net sales in 2019 from 2018 was primarily the result of:


•	selective increases in selling prices to mitigate inflationary cost increases; and


•	savings generated from restructuring and lean initiatives.

This increase was partially offset by:


•	inflationary increases related to certain raw materials, labor and freight costs; and


•	lower sales volume resulting in decreased leverage on fixed expenses.

Thermal Management

The net sales and segment income for Thermal Management were as follows:



	Years ended December 31						% / point change
In millions	2019			2018			2019 vs 2018
Net sales	$	590.6		$	623.2		(5.2	%)
Segment income	145.3			154.2			(5.8	%)
% of net sales	24.6		%	24.7		%	(0.1	pts)

Net sales

The components of the change in Thermal Management net sales were as follows:



	2019 vs 2018
Volume	(3.6	%)
Price	0.8
Organic growth	(2.8	)
Currency	(2.4	)
Total	(5.2	%)

The 5.2 percent decrease in Thermal Management net sales in 2019 from 2018 was primarily the result of:


•	slowdown in capital spending resulting in organic sales decline of approximately 5.0% contributed from our industrial business; and


•	unfavorable foreign currency effects.

This decrease was partially offset by:


•	organic sales growth in the after-market repair and maintenance component of our industrial business.

Segment income

The components of the change in Thermal Management segment income as a percentage of net sales from the prior period were as follows:



	2019 vs 2018
Growth	(1.6	pts)
Price	0.6
Currency	0.1
Net productivity	0.8
Total	(0.1	pts)

The 0.1 percentage point decrease in segment income for Thermal Management as a percentage of net sales in 2019 from 2018 was primarily the result of:


•	lower sales volume resulting in decreased leverage on fixed expenses;


•	inflationary increases related to certain raw materials, labor and freight costs; and


•	the impact of unfavorable product mix.

This decrease was partially offset by:


•	savings generated from restructuring and lean initiatives; and


•	selective increases in selling prices to mitigate inflationary cost increases.

Electrical & Fastening Solutions

The net sales and segment income for Electrical & Fastening Solutions were as follows:



	Years ended December 31						% / point change
In millions	2019			2018			2019 vs 2018
Net sales	$	579.6		$	570.7		1.6	%
Segment income	149.7			144.5			3.6	%
% of net sales	25.8		%	25.3		%	0.5	pts

Net sales

The components of the change in Electrical & Fastening Solutions net sales were as follows:



	2019 vs 2018
Volume	(0.3	%)
Price	3.3
Organic growth	3.0
Currency	(1.4	)
Total	1.6	%

The 1.6 percent increase in Electrical & Fastening Solutions net sales in 2019 from 2018 was primarily the result of:


•	organic sales growth contribution of approximately 2.0% from our commercial & residential business, which includes selective increases in selling prices.

This increase was partially offset by


•	unfavorable foreign currency effects.

Segment income

The components of the change in Electrical & Fastening Solutions segment income as a percentage of net sales from the prior period were as follows:



	2019 vs 2018
Growth	(0.2	pts)
Price	2.4
Currency	0.2
Net productivity	(1.9	)
Total	0.5	pts

The 0.5 percentage point increase in segment income for Electrical & Fastening Solutions as a percentage of net sales in 2019 from 2018 was primarily the result of:


•	selective increases in selling prices to offset inflationary cost increases; and


•	savings generated from our lean and supply management practices.

This increase was partially offset by:


•	inflationary increases related to certain raw materials, labor and freight costs.

LIQUIDITY AND CAPITAL RESOURCES

The primary source of liquidity for our business is cash flows provided by operations. For periods prior to the separation, transfers of cash to and from the former Parent's cash management system have been reflected in the Net Parent investment in the historical Consolidated and Combined Statements of Cash Flows and Consolidated and Combined Statements of Changes in Equity. In connection with the separation, our capital structure and sources of liquidity changed significantly from our historical capital structure. Our businesses no longer participate in cash management and funding arrangements with the former Parent.

We expect to continue to have cash requirements to support working capital needs and capital expenditures, to pay interest and service debt and to pay dividends to shareholders quarterly. We believe we have the ability and sufficient capacity to meet these cash requirements by using available cash and internally generated funds and borrowing under committed credit facilities. We are focused on increasing our cash flow, while continuing to fund our research and development, sales and marketing and capital investment initiatives. Our intent is to maintain investment grade metrics and a solid liquidity position.

We experience seasonal cash flows primarily due to increased demand for Thermal Management products and services during the fall and winter months in the Northern Hemisphere and increased demand for Electrical & Fastening Solutions products during the spring and summer months in the Northern Hemisphere.

Operating activities

Net cash provided by operating activities was $336.3 million in 2019, compared to $343.5 million in 2018. Cash provided by operating activities in 2019 primarily reflects net income, net of non-cash depreciation and amortization, of $319.5 million, and the positive impact of $6.3 million as a result of changes in net working capital. Cash provided by operating activities in 2018 primarily reflects net income, net of non-cash depreciation and amortization, of $327.9 million, and the positive impact of $41.7 million as a result of changes in net working capital.

Investing activities

Net cash used for investing activities of continuing operations was $160.3 million in 2019, compared to net cash used for investing activities of $39.1 million in 2018. Net cash used for investing activities in 2019 primarily related to cash paid for the acquisition of Eldon of $127.8 million, net of cash acquired, and capital expenditures of $38.8 million. Net cash used for investing activities in 2018 primarily related to capital expenditures of $39.5 million. Capital expenditures are primarily used for capacity expansions of manufacturing facilities, developing new products and general maintenance.

Financing activities

For periods prior to the separation, transfers of cash, both to and from the former Parent’s centralized cash management system are reflected as a financing activity on the Consolidated and Combined Statements of Cash Flows.

Net cash used for financing activities was $226.4 million in 2019, which primarily related to share repurchases of $235.7 million and dividends paid of $120.7 million, partially offset by net receipts of revolving long-term debt of $134.6 million.

Net cash used for financing activities was $166.6 million in 2018, which primarily related to $1.0 billion of proceeds from long-term debt, offset by $993.6 million of cash provided to the former Parent in connection with the separation. In addition, we repaid $52.5 million of outstanding principal on the Term Loan Facility, executed share repurchases of $56.0 million and paid dividends of $62.9 million.

Senior notes

In March 2018, nVent Finance S.à r.l. (“nVent Finance” or “Subsidiary Issuer”), a 100-percent owned subsidiary of nVent, issued $300.0 million aggregate principal amount of 3.950% senior notes due 2023 (the "2023 Notes") and $500.0 million aggregate principal amount of 4.550% senior notes due 2028 (the "2028 Notes" and, collectively with the 2023 Notes, the "Notes"). Interest on the Notes is payable semi-annually in arrears on April 15 and October 15 of each year.

The Notes are fully and unconditionally guaranteed as to payment by nVent ("the Parent Company Guarantor"). There are no subsidiaries that guarantee the Notes. The Parent Company Guarantor has no independent assets or operations unrelated to its investments in its consolidated subsidiaries. The Subsidiary Issuer has no independent assets or operations unrelated to its investments in its consolidated subsidiaries and the issuance of the Notes and other external debt.

The Notes constitute general unsecured senior obligations of the Subsidiary Issuer and rank equally in right of payment with all existing and future unsubordinated and unsecured indebtedness and liabilities of the Subsidiary Issuer. The guarantees of the Notes by the Parent Company Guarantor constitute general unsecured obligations of the Parent Company Guarantor and rank equally in right of payment with all existing and future unsubordinated and unsecured indebtedness and liabilities of the Subsidiary Issuer. Subject to certain qualifications and exceptions, the indenture pursuant to which the Notes were issued contains covenants that, among other things, restrict nVent’s, nVent Finance’s and certain subsidiaries’ ability to merge or consolidate with another person, create liens or engage in sale and lease-back transactions.

There are no significant restrictions on the ability of nVent to obtain funds from its subsidiaries by dividend or loan. None of the assets of nVent or its subsidiaries represents restricted net assets pursuant to the guidelines established by the SEC.

Senior credit facilities

In March 2018, nVent Finance entered into a credit agreement with a syndicate of banks providing for a five-year $200.0 million senior unsecured term loan facility (the "Term Loan Facility") and a five-year $600.0 million senior unsecured revolving credit facility (the "Revolving Credit Facility" and, together with the Term Loan Facility, the "Senior Credit Facilities"). We have the option to request to increase the Revolving Credit Facility in an aggregate amount of up to $300.0 million, subject to customary conditions, including the commitment of the participating lenders. As of December 31, 2019, there were outstanding borrowings of $134.6 million, and total availability of $465.4 million under the Revolving Credit Facility.

Our debt agreements contain certain financial covenants, the most restrictive of which are in the Senior Credit Facilities, including that we may not permit (i) the ratio of our consolidated debt (net of our consolidated unrestricted cash in excess of $5.0 million but not to exceed $250.0 million) to our consolidated net income (excluding, among other things, non-cash gains and losses) before interest, taxes, depreciation, amortization and non-cash share-based compensation expense ("EBITDA") on the last day of any period of four consecutive fiscal quarters to exceed 3.75 to 1.00 and (ii) the ratio of our EBITDA to our consolidated interest expense for the same period to be less than 3.00 to 1.00. In addition, subject to certain qualifications and exceptions, the Senior Credit Facilities also contain covenants that, among other things, restrict our ability to create liens, merge or consolidate with another person, make acquisitions and incur subsidiary debt. As of December 31, 2019, we were in compliance with all financial covenants in our debt agreements.

As of December 31, 2019, we have $14.9 million of cash held in certain countries in which the ability to repatriate is limited due to local regulations or significant potential tax consequences.

Dividends

Dividends paid per ordinary share were $0.70 and $0.35 for the years ended December 31, 2019 and 2018, respectively.

On December 10, 2019, the Board of Directors declared a quarterly cash dividend of $0.175 that was paid on February 7, 2020 to shareholders of record at the close of business on January 24, 2020. The balance of dividends payable included in Other current liabilities on our Consolidated Balance Sheets was $29.7 million and $31.0 million at December 31, 2019 and 2018, respectively.

On February 25, 2020, the Board of Directors declared a quarterly cash dividend of $0.175 per ordinary share payable on May 8, 2020 to shareholders of record at the close of business on April 24, 2020.

Under Irish law, the payment of future cash dividends and repurchases of shares may be paid only out of nVent Electric plc's "distributable reserves" on its statutory balance sheet. nVent Electric plc is not permitted to pay dividends out of share capital, which includes share premiums. Distributable reserves may be created through the earnings of the Irish parent company and through a reduction in share capital approved by the Irish High Court. Distributable reserves are not linked to a generally accepted accounting principles in the United States of America ("GAAP") reported amount (e.g., retained earnings). In June 2018, the Irish High Court approved nVent Electric plc's conversion of approximately $3.8 billion of share premium to distributable reserves, and in July 2018, we made the required filing of nVent Electric plc's initial accounts with the Irish Companies Registration Office to complete the process.

Authorized shares

Our authorized share capital consists of 400.0 million ordinary shares with a par value of $0.01 per share.

Share repurchases

On July 23, 2018, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $500.0 million (the "2018 Authorization'"). On February 19, 2019, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $380.0 million (the "2019 Authorization"). The 2018 and 2019 Authorizations expire on July 23, 2021.

During the year ended December 31, 2019, we repurchased 9.0 million of our ordinary shares for $232.7 million under the 2018 Authorization. As of December 31, 2019, we had $588.3 million available for repurchases under the 2018 and 2019 Authorizations, which total $880.0 million.

Contractual obligations

The following summarizes our significant contractual obligations that impact our liquidity:



	Years ended December 31
In millions	2020		2021		2022		2023		2024		Thereafter		Total
Debt obligations	$	17.5	$	20.0	$	20.0	$	512.1	$	—	$	500.0	$	1,069.6
Interest obligations on fixed-rate debt	34.6		34.6		34.6		28.7		22.8		79.8		235.1
Operating lease obligations, net of sublease rentals	16.7		11.4		7.5		4.4		3.5		10.9		54.4
Purchase obligations	49.4		—		—		—		—		—		49.4
Pension and other post-retirement plan contributions	5.8		6.2		8.6		6.4		8.1		42.5		77.6
Total contractual obligations, net	$	124.0	$	72.2	$	70.7	$	551.6	$	34.4	$	633.2	$	1,486.1

The majority of the purchase obligations represent commitments for raw materials to be utilized in the normal course of business. For purposes of the above table, arrangements are considered purchase obligations if a contract specifies all significant terms, including fixed or minimum quantities to be purchased, a pricing structure and approximate timing of the transaction.

In addition to the summary of significant contractual obligations, we will incur annual interest expense on outstanding variable rate debt. As of December 31, 2019, variable interest rate debt was $269.6 million at a weighted average interest rate of 3.167%.

The total gross liability for uncertain tax positions at December 31, 2019 was estimated to be $17.0 million. We record penalties and interest related to unrecognized tax benefits in Provision (benefit) for income taxes and Net interest expense, respectively, which is consistent with our past practices. As of December 31, 2019, we had recorded $1.7 million for the possible payment of penalties and $3.0 million related to the possible payment of interest.

Other financial measures

In addition to measuring our cash flow generation or usage based upon operating, investing and financing classifications included in the Consolidated and Combined Statements of Cash Flows, we also measure our free cash flow. Free cash flow is a non-GAAP financial measure that we use to assess our cash flow performance. We believe free cash flow is an important measure of liquidity because it provides us and our investors a measurement of cash generated from operations that is available to pay dividends, make acquisitions, repay debt and repurchase shares. In addition, free cash flow is used as a criterion to measure and pay compensation-based incentives. Our measure of free cash flow may not be comparable to similarly titled measures reported by other companies.

The following table is a reconciliation of free cash flow:



	Years ended December 31
In millions	2019			2018
Net cash provided by (used for) operating activities	$	336.3		$	343.5
Capital expenditures	(38.8		)	(39.5		)
Proceeds from sale of property and equipment	6.3			2.4
Free cash flow	$	303.8		$	306.4

Off-balance sheet arrangements

At December 31, 2019, we had no off-balance sheet financing arrangements.

COMMITMENTS AND CONTINGENCIES

We have been, and in the future may be, made parties to a number of actions filed or have been, and in the future may be, given notice of potential claims relating to the conduct of our business, including those pertaining to commercial or contractual disputes, product liability, environmental, safety and health, patent infringement and employment matters.

While we believe that a material impact on our consolidated financial position, results of operations or cash flows from any such future claims or potential claims is unlikely, given the inherent uncertainty of litigation, a remote possibility exists that a future adverse ruling or unfavorable development could result in future charges that could have a material impact. We do and will continue to periodically re-examine our estimates of probable liabilities and any associated expenses and receivables and make appropriate adjustments to such estimates based on experience and developments in litigation. As a result, the current estimates of the potential impact on our consolidated financial position, results of operations and cash flows for the proceedings and claims described in ITEM 8, Note 16 of the Notes to the Consolidated and Combined Financial Statements could change in the future.

Stand-by Letters of Credit, Bank Guarantees and Bonds

In disposing of assets or businesses, we often provide representations, warranties and indemnities to cover various risks including unknown damage to assets, environmental risks involved in the sale of real estate, liability to investigate and remediate environmental contamination at waste disposal sites and manufacturing facilities and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not have the ability to reasonably estimate the potential liability due to the inchoate and unknown nature of these potential liabilities. However, we have no reason to believe that these uncertainties would have a material adverse effect on our financial position, results of operations or cash flows. In the ordinary course of business, we are required to commit to bonds, letters of credit and bank guarantees that require payments to our customers for any non-performance. The outstanding face value of these instruments fluctuates with the value of our projects in process and in our backlog. In addition, we issue financial stand-by letters of credit primarily to secure our performance to third parties under self-insurance programs.

As of December 31, 2019 and 2018, the outstanding value of bonds, letters of credit and bank guarantees totaled $70.0 million and $75.8 million, respectively.

NEW ACCOUNTING STANDARDS

See ITEM 8, Note 1 of the Notes to Consolidated and Combined Financial Statements, included in this Form 10-K, for information pertaining to recently adopted accounting standards or accounting standards to be adopted in the future.

CRITICAL ACCOUNTING POLICIES

We have adopted various accounting policies to prepare the consolidated and combined financial statements in accordance with GAAP. Our significant accounting policies are more fully described in ITEM 8, Note 1 of the Notes to Consolidated and Combined Financial Statements. Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. These judgments are based on our historical experience, terms of existing contracts, our observance of trends in the industry and information available from other outside sources, as appropriate. We consider an accounting estimate to be critical if:


•	it requires us to make assumptions about matters that were uncertain at the time we were making the estimate; and


•	changes in the estimate or different estimates that we could have selected would have had a material impact on our financial condition or results of operations.

Our critical accounting estimates include the following:

Cost allocations

For periods prior to the separation, the consolidated and combined financial statements of nVent include general corporate expenses of the former Parent for certain support functions that were provided on a centralized basis, such as expenses related to executive management, finance, audit, legal, information technology, human resources, communications, facilities and employee benefits and compensation. These general corporate expenses are included in the Consolidated and Combined Statements of Operations and Comprehensive Income within Selling, general and administrative expense and Other expense. The amount allocated was $42.5 million for the year ended December 31, 2018, of which $10.3 million was historically recorded to the Electrical segment in the former Parent’s consolidated financial statements. These expenses were allocated to nVent on the basis of direct usage when identifiable, with the remainder allocated based on a proportional basis of net sales, headcount or other measures.

The Company considers the allocation methodology regarding the former Parent’s general corporate expenses to be reasonable for all periods presented. Nevertheless, the consolidated and combined financial statements of nVent for periods prior to the separation may not reflect the actual expenses that would have been incurred and may not reflect nVent’s consolidated and combined results of operations, financial position and cash flows had it been a stand-alone company during the periods presented. Actual costs for periods prior to the separation that would have been incurred if nVent had been a stand-alone company would depend on multiple factors including organization structure, capital structure and strategic decisions made in various areas, including information technology and infrastructure. Transactions between nVent and the former Parent have been included in related party transactions in these consolidated and combined financial statements and were considered to be effectively settled at the time the transaction was recorded. The total net effect of the settlement of these transactions is reflected in the Consolidated and Combined Statements of Cash Flows as a financing activity.

Impairment of goodwill and indefinite-lived intangibles

Goodwill

Goodwill represents the excess of the cost of acquired businesses over the net of the fair value of identifiable tangible net assets and identifiable intangible assets purchased and liabilities assumed.

Goodwill is tested annually for impairment as of the first day of the fourth quarter, and is tested for impairment more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test is performed using a two-step process. In the first step, the fair value of each reporting unit is compared with the carrying amount of the reporting unit, including goodwill. If the estimated fair value is less than the carrying amount of the reporting unit there is an indication that goodwill impairment exists and a second step must be completed in order to determine the amount of the goodwill impairment, if any, which should be recorded. In the second step, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill. The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation.

The fair value of each reporting unit is determined using a discounted cash flow analysis and market approach. Projecting discounted future cash flows requires us to make significant estimates regarding future revenues and expenses, projected capital expenditures, changes in working capital and the appropriate discount rate. Use of the market approach consists of comparisons to comparable publicly-traded companies that are similar in size and industry. Actual results may differ from those used in our valuations.

In developing our discounted cash flow analysis, assumptions about future revenues and expenses, capital expenditures and changes in working capital are based on our annual operating plan and long-term business plan for each of our reporting units. These plans take into consideration numerous factors including historical experience, anticipated future economic conditions, changes in raw material prices and growth expectations for the industries and end markets we participate in. These assumptions are determined over a six year long-term planning period. The six year growth rates for revenues and operating profits vary for each reporting unit being evaluated. Revenues and operating profit beyond 2025 are projected to grow at a perpetual growth rate of 3.0%.

Discount rate assumptions for each reporting unit take into consideration our assessment of risks inherent in the future cash flows of the respective reporting unit and our weighted-average cost of capital. We utilized a discount rate ranging from 10.0% to 10.5% for each reporting unit in determining the discounted cash flows in our fair value analysis.

In estimating fair value using the market approach, we identify a group of comparable publicly-traded companies for each reporting unit that are similar in terms of size and product offering. These groups of comparable companies are used to develop multiples based on total market-based invested capital as a multiple of earnings before interest, taxes, depreciation and amortization (“EBITDA”). We determine our estimated values by applying these comparable EBITDA multiples to the operating results of our reporting units. The ultimate fair value of each reporting unit is determined considering the results of both valuation methods.

We did not recognize any goodwill impairment losses in 2019 and 2018.

Identifiable intangible assets

Our primary identifiable intangible assets include: customer relationships, trade names, proprietary technologies and patents. Identifiable intangibles with definite lives are amortized and those identifiable intangibles with indefinite lives are not amortized. Identifiable intangible assets that are subject to amortization are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Identifiable intangible assets not subject to amortization are tested for impairment annually or more frequently if events warrant. We complete our annual impairment test during the fourth quarter each year for those identifiable assets not subject to amortization.

The impairment test for trade names consists of a comparison of the fair value of the trade name with its carrying value. Fair value is measured using the relief-from-royalty method. This method assumes the trade name has value to the extent that the owner is relieved of the obligation to pay royalties for the benefits received from them. This method requires us to estimate the future revenue for the related brands, the appropriate royalty rate and the weighted average cost of capital.

There were no impairment charges recorded in 2019 or 2018 for identifiable intangible assets.

Pension and other post-retirement plans

We sponsor defined-benefit pension plans and a post-retirement health plan ("Direct Plans"). The defined benefit plans cover certain non-U.S. employees and retirees and the pension benefits are based principally on an employee's years of service and/or compensation levels near retirement. For periods prior to the separation, certain nVent employees participated in defined benefit pension plans and post-retirement health plans sponsored by the former Parent. For purposes of these consolidated and combined financial statements, nVent accounts for these plans as multi-employer benefit plans. Accordingly, nVent does not record an asset or liability to recognize the funded status of these plans. However, nVent does record its share of the allocated expense, including net actuarial gains or losses described below.

The amounts recognized in our consolidated and combined financial statements related to our defined-benefit pension and other post-retirement plans are determined from actuarial valuations. Inherent in these valuations are assumptions, including: expected return on plan assets, discount rates and rate of increase in future compensation levels. These assumptions are updated annually and are disclosed for our Direct Plans in ITEM 8, Note 12 to the Notes to Consolidated and Combined Financial Statements. Differences in actual experience or changes in assumptions may affect our pension and other post-retirement obligations and future expense.

We recognize changes in the fair value of plan assets and net actuarial gains or losses for pension and other post-retirement benefits annually in the fourth quarter each year (“mark-to-market adjustment”) and, if applicable, in any quarter in which an interim remeasurement is triggered. Net actuarial gains and losses occur when the actual experience differs from any of the various assumptions used to value our pension and other post-retirement plans or when assumptions change, as they may each year. The primary factors contributing to actuarial gains and losses each year are (1) changes in the discount rate used to value pension and other post-retirement benefit obligations as of the measurement date and (2) differences between the expected and the actual return on plan assets. This accounting method also results in the potential for volatile and difficult to forecast mark-to-market adjustments. Mark-to-market adjustments resulted in a pre-tax charge of $27.3 million in 2019 and $7.0 million in 2018. The remaining components of pension expense, including service and interest costs and estimated return on plan assets, are recorded on a quarterly basis as ongoing pension expense.

Discount rates

The discount rate reflects the current rate at which the pension liabilities could be effectively settled at the end of the year based on our December 31 measurement date. The discount rates on our pension plans ranged from 0.25% to 3.25% and 0.50% to 4.25% in 2019 and 2018, respectively. The discount rates are determined by matching high-quality, fixed-income debt instruments with maturities corresponding to the expected timing of benefit payments as of the annual measurement date for each of the various plans. There are no known or anticipated changes in our discount rate assumptions that will materially impact our pension expense in 2020.

Expected rates of return

The expected rates of return on our pension plan assets ranged from 1.00% to 5.25% and 1.00% to 5.50% in 2019 and 2018, respectively. The expected rate of return is designed to be a long-term assumption that may be subject to considerable year-to-year variance from actual returns. In developing the expected long-term rate of return, we considered our historical returns, with consideration given to forecasted economic conditions, our asset allocations, input from external consultants and broader long-term market indices. Any difference in the expected rate and actual returns will be included with the actuarial gain or loss recorded in the fourth quarter when our plans are remeasured.

Sensitivity to changes in key assumptions

A 0.25 percentage point change in the discount rates used to measure our pension and other post-retirement benefit plans is estimated to have an impact on our total projected benefit obligation of approximately $11 million. A 0.25 percentage point change in the assumed rate of return on pension assets or discount rates for our pension and other post-retirement benefit plans is estimated to have no material impact on our ongoing 2020 pension expense. These estimates exclude any potential mark-to-market adjustments.

Income taxes

For periods prior to the separation, certain nVent operations were included in the former Parent’s U.S. federal and state income tax returns and substantially all income taxes on those operations have been paid by the former Parent. Income tax expense and other income tax related information contained in these consolidated and combined financial statements for periods prior to the separation are presented on a separate return approach as if nVent filed its own tax returns. Under this approach, the provision for income taxes represented income tax paid or payable (or received or receivable) for the current year plus the change in deferred taxes during the year calculated as if nVent was a stand-alone taxpayer filing hypothetical income tax returns where applicable. Current income tax liabilities were assumed to be immediately settled with the former Parent and relieved through the Net Parent investment account and the Net transfers to Parent in the Consolidated and Combined Statements of Cash Flows.

In determining taxable income for financial statement purposes, we must make certain estimates and judgments. These estimates and judgments affect the calculation of certain tax liabilities and the determination of the recoverability of certain of the deferred tax assets, which arise from temporary differences between the tax and financial statement recognition of revenue and expense. In evaluating our ability to recover our deferred tax assets we consider all available positive and negative evidence including our past operating results, the existence of cumulative losses in the most recent years and our forecast of future taxable income. In estimating future taxable income, we develop assumptions including the amount of future pre-tax operating income, the reversal of temporary differences and the implementation of feasible and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates we are using to manage the underlying businesses.

We maintain valuation allowances with respect to our deferred tax assets unless it is more likely than not that all or a portion of such deferred tax assets will be realized. Our income tax expense recorded in the future may be reduced to the extent of decreases in our valuation allowances. The realization of our remaining deferred tax assets is primarily dependent on future taxable income in the appropriate jurisdiction. Any reduction in future taxable income including but not limited to any future restructuring activities may require that we record an additional valuation allowance against our deferred tax assets. An increase in the valuation allowance could result in additional income tax expense in such period and could have a significant impact on our future earnings.

Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities in the future. Management records the effect of a tax rate or law change on nVent’s deferred tax assets and liabilities in the period of enactment. Future tax rate or law changes could have a material effect on nVent’s financial condition, results of operations or cash flows.

In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations in a multitude of jurisdictions across our global operations. We perform reviews of our income tax positions on a quarterly basis and accrue for uncertain tax positions. We recognize potential liabilities and record tax liabilities for anticipated tax audit issues in the tax jurisdictions in which we operate based on our estimate of whether, and the extent to which, additional taxes will be due. These tax liabilities are reflected net of related tax loss carryforwards. As events change or resolution occurs, these liabilities are adjusted, such as in the case of audit settlements with taxing authorities. The ultimate resolution may result in a payment that is materially different from our current estimate of the tax liabilities. If our estimate of tax liabilities proves to be less than the ultimate assessment, an additional charge to expense would result. If payment of these amounts ultimately proves to be less than the recorded amounts, the reversal of the liabilities would result in tax benefits being recognized in the period when we determine the liabilities are no longer necessary. We recognize the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is more likely than not to be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the potential economic loss that may result from adverse changes in the fair value of financial instruments. We are exposed to various market risks, including changes in interest rates and foreign currency rates. Periodically, we use derivative financial instruments for the purpose of hedging interest rate and currency exposures. The major accounting policies and utilization of these instruments is described more fully in ITEM 8, Note 1 of the Notes to Consolidated and Combined Financial Statements.

Interest rate risk

Our debt portfolio as of December 31, 2019 was comprised of debt denominated in U.S. dollars. The debt portfolio is comprised of approximately 75% fixed-rate debt and 25% variable-rate debt. Changes in interest rates have different impacts on the fixed and variable-rate portions of our debt portfolio. A change in interest rates on the fixed portion of the debt portfolio impacts the fair value, but has no impact on interest incurred or cash flows. A change in interest rates on the variable portion of the debt portfolio impacts the interest incurred and cash flows but does not impact the net financial instrument position.

Based on the fixed-rate debt included in our debt portfolio, as of December 31, 2019, a 100 basis point increase or decrease in interest rates would result in a $47.5 million decrease or a $51.1 million increase in fair value, respectively.

Based on the variable-rate debt included in our debt portfolio as of December 31, 2019, a 100 basis point increase or decrease in interest rates would result in a $2.7 million increase or decrease in interest incurred.

Foreign currency risk

We conduct business in various locations throughout the world and are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S. dollar. Periodically, we use derivative financial instruments to manage these risks. The functional currencies of our foreign operating locations are generally the local currency in the country of domicile. We manage these operating activities at the local level and revenues, costs, assets and liabilities are generally denominated in local currencies, thereby mitigating the risk associated with changes in foreign exchange. However, our results of operations and assets and liabilities are reported in U.S. dollars and thus will fluctuate with changes in exchange rates between such local currencies and the U.S. dollar.

From time to time, we may enter into foreign currency contracts to hedge certain foreign currency risks. As the majority of our foreign currency contracts have an original maturity date of less than one year, there is no material risk of fluctuations in the value of these contracts. Counterparties to all derivative contracts are major financial institutions. All instruments are entered into for other than trading purposes.

At December 31, 2019 and 2018, we had outstanding foreign currency derivative contracts with gross notional U.S. dollar equivalent amounts of $268.9 million and $129.0 million, respectively. Changes in the fair value of all derivatives are recognized immediately in income unless the derivative qualifies as a hedge of future cash flows. Gains and losses related to a hedge are deferred and recorded in the Consolidated Balance Sheets as a component of Accumulated other comprehensive income (loss) and subsequently recognized in the Consolidated and Combined Statements of Operations and Comprehensive Income when the hedged item affects earnings.

At both December 31, 2019 and 2018, we had a gross notional U.S. dollar equivalent amount of $69.1 million designated as a net investment hedge for a portion of our net investment in our Euro denominated subsidiaries. The hedge is intended to reduce, but will not eliminate, the impact on our financial results of changes in the exchange rate between the Euro and the U.S. dollar. The currency risk related to the net investment hedge is measured by estimating the potential impact of a 10% change in the value of the U.S. dollar relative to the Euro. The rates used to perform this analysis were based on the market exchange rates in effect on December 31, 2019. A 10% appreciation of the U.S. dollar relative to the Euro would result in a $6.0 million net increase in Other comprehensive income. Conversely, a 10% depreciation of the U.S. dollar relative to the Euro would result in a $7.4 million net decrease in Other comprehensive income. However, these increases and decreases in Other comprehensive income would be offset by decreases or increases in the hedged net investments on our balance sheet due to currency translation.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of nVent Electric plc and its subsidiaries (the "Company") is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934. The Company's internal control over financial reporting is designed 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. The Company's internal control over financial reporting includes those policies and procedures that (1) pertain to maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2019. In making this assessment, management used the criteria for effective internal control over financial reporting described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management believes that, as of December 31, 2019, the Company's internal control over financial reporting was effective based on those criteria.

Our independent registered public accounting firm, Deloitte & Touche LLP, has issued an attestation report on the Company's internal control over financial reporting as of December 31, 2019. That attestation report is set forth immediately following this management report.



Beth A. Wozniak		Sara E. Zawoyski
Chief Executive Officer		Executive Vice President and Chief Financial Officer

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of

nVent Electric plc

London, United Kingdom

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of nVent Electric plc and subsidiaries (the "Company") as of December 31, 2019, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on the criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the financial statements as of and for the year ended December 31, 2019, of the Company and our report dated February 25, 2020 expressed an unqualified opinion on those financial statements and included an emphasis of a matter paragraph regarding the allocation of expenses from Pentair plc for the periods prior to April 30, 2018.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed 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. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Minneapolis, Minnesota

February 25, 2020

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of

nVent Electric plc

London, United Kingdom

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of nVent Electric plc (the "Company") as of December 31, 2019 and 2018, the related consolidated and combined statements of operations and comprehensive income, changes in equity, and cash flows, for each of the three years in the period ended December 31, 2019, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2020, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Emphasis of a Matter

As described in Note 1, prior to April 30, 2018, the accompanying consolidated and combined financial statements have been derived from the consolidated financial statements and accounting records of Pentair plc. The consolidated and combined financial statements also include expense allocations for certain corporate functions historically provided by Pentair plc. These allocations may not be reflective of the actual expense which would have been incurred had the Company operated as a separate entity apart from Pentair plc during the periods prior to April 30, 2018.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Goodwill - Certain Reporting Units - Refer to Notes 1 and 6 to the financial statements

Critical Audit Matter Description

The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying value. The Company determines the fair value of its reporting units using income and market approaches. The determination of the fair value using an income approach involves the use of a discounted cash flow model that requires management to make significant estimates and assumptions related to future revenues and expenses, projected capital expenditures, changes in working capital and discount rates. The determination of the fair value using the market approach

requires management to make significant assumptions related to earnings before interest, taxes, depreciation, and amortization (EBITDA) multiples. The goodwill balance was $2,279 million as of December 31, 2019, and no impairment was recognized as the fair value of all reporting units exceeded their carrying values as of the measurement date.

Given the significant judgments made by management to estimate the fair value of certain reporting units and the difference between their fair value and carrying value, performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to selection of the discount rates and forecasts of future revenues and operating margins required a high degree of auditor judgment and an increased extent of effort, including the need to involve fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to significant estimates and assumptions for certain reporting units included the following, among others:


•	We tested the effectiveness of controls over goodwill, including those over the underlying assumptions to forecast future revenue and operating margins, the selection of the discount rates, and the selection of the EBITDA multiples.


•	We evaluated management’s ability to accurately forecast future revenues and operating margins by comparing actual results to management’s historical forecasts.


•	We evaluated the reasonableness of management’s forecasts by comparing the forecasts to (1) historical results, (2) internal communications to management and the Board of Directors, and (3) forecasted information included in Company press releases, analyst and industry reports of the Company and companies in its peer group.


•	With the assistance of our fair value specialists, we evaluated the discount rates, including testing the underlying source information and the mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the discount rates selected by management.


•	With the assistance of our fair value specialists, we evaluated the EBITDA multiples used in estimating fair value, including testing the underlying source information and mathematical accuracy of the calculations, and comparing the multiples selected by management to its guideline companies.

Indefinite-Life Intangibles - Certain Trade Names - Refer to Notes 1 and 6 to the financial statements

Critical Audit Matter Description

The Company’s evaluation of indefinite-life intangibles, including trade names, for impairment involves the comparison of the fair value of each indefinite-life intangible to its carrying value. The Company determines the fair value of its trade names using an income approach known as the relief-from-royalty method. The determination of the fair value using the relief-from-royalty method requires management to make significant estimates and assumptions related to forecasts of future revenues, and royalty and discount rates. The trade names balance was $281 million as of December 31, 2019. The fair values of these trade names exceeded their carrying values as of the measurement date and, therefore, no impairment was recognized.

Given the determination of fair values of certain trade names requires management to make significant estimates and assumptions relating to the forecasts of future revenues and the selection of discount and royalty rates, performing audit procedures to evaluate the reasonableness of such estimates and assumptions required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to significant estimates and assumptions for the indefinite-lived intangible assets included the following, among others:


•	We tested the effectiveness of controls over trade names, including those over the forecasts of future revenues and the selection of the royalty and discount rates.


•	We evaluated management’s ability to accurately forecast by comparing actual results to management’s historical forecasts.


•	We evaluated the reasonableness of management’s forecasts by comparing the forecasts to (1) historical results, (2) internal communications to management and the Board of Directors, and (3) forecasted information included in Company press releases, analyst and industry reports of the Company and companies in its peer group.


•	With the assistance of our fair value specialists, we evaluated the royalty and discount rates, including testing the underlying source information and the mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the royalty and discount rates selected by management.

Income Taxes - Uncertain Tax Positions - Refer to Notes 1 and 11 in the financial statements

Critical Audit Matter Description

The Company’s calculation of its tax liabilities involves evaluating uncertainties in the application of complex tax regulations in a multitude of jurisdictions around the world. The Company recognizes liabilities for uncertain tax positions based on their estimate of whether, and the extent to which, additional taxes may be due. The effect of income tax positions is recognized only if those positions are determined to be more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is more likely than not to be realized.

Given the complexity of the tax laws and regulations associated with certain tax positions taken by the Company, auditing management’s estimate of the tax positions to be sustained upon examination required a high degree of auditor judgment and an increased extent of effort, including the need to involve our income tax specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to uncertain tax positions and determination of whether the Company has appropriately recorded all such positions that meet the more likely than not criteria included the following, among others:


•	We tested the effectiveness of controls over uncertain tax positions.


•	With the assistance of income tax specialists, we evaluated the following sources of information for management’s tax positions taken and benefits recognized:


•	Management’s technical tax memorandum and related appendices.


•	Analysis performed by external tax specialists.


•	Historical tax return data.


•	Results of audits performed by tax authorities.


•	With the assistance of income tax specialists, we assessed management’s conclusion as to whether the recorded tax benefits are more likely than not to be sustained on the basis of their technical merits.


•	With the assistance of income tax specialists, we evaluated the reasonableness of management’s estimates of the tax benefit to be recognized by:


•	Evaluating the Company’s analysis of tax regulations and their application to the Company’s particular facts in each relevant jurisdiction.


•	Reviewing changes in tax laws and regulations or their application by the relevant taxing authorities.


•	Evaluating the impact of changes in taxable income, available tax credits, or other economic factors that could affect recorded tax benefits.


•	Assessing conclusions that benefits meet the more likely than not criteria to be realized.


•	Evaluating the appropriateness of the underlying assumptions in management’s estimates.


•	Assessing management's methods and assumptions used in identifying uncertain tax positions.


•	Comparing results of prior tax audits to ongoing and anticipated tax audits by tax authorities.


•	With the assistance of income tax specialists, we evaluated a sample of the reserves for unrecognized tax benefits to assess the establishment and amount of the liability for the specific underlying tax position.

/s/ Deloitte & Touche LLP

Minneapolis, Minnesota

February 25, 2020

We have served as the Company's auditor since 2017.

nVent Electric plc

Consolidated and Combined Statements of Operations and Comprehensive Income



	Years ended December 31
In millions, except per-share data	2019		2018			2017
Net sales	$	2,204.0	$	2,213.6		$	2,097.9
Cost of goods sold	1,338.2		1,337.5			1,256.0
Gross profit	865.8		876.1			841.9
Selling, general and administrative	484.5		519.7			483.3
Research and development	48.2		45.6			42.5
Operating income	333.1		310.8			316.1
Net interest expense	44.7		31.2			0.2
Other expense	31.0		10.9			2.6
Income before income taxes	257.4		268.7			313.3
Provision (benefit) for income taxes	34.7		37.9			(48.4		)
Net income	$	222.7	$	230.8		$	361.7
Comprehensive income, net of tax
Net income	$	222.7	$	230.8		$	361.7
Changes in cumulative translation adjustment	4.8		(48.2		)	2.4
Changes in market value of derivative financial instruments, net of tax	4.4		(2.5		)	1.1
Comprehensive income	$	231.9	$	180.1		$	365.2
Earnings per ordinary share
Basic	$	1.30	$	1.29		$	2.02
Diluted	$	1.29	$	1.28		$	2.00
Weighted average ordinary shares outstanding
Basic	171.6		178.6			179.0
Diluted	173.0		180.8			181.2

See accompanying notes to consolidated and combined financial statements.

nVent Electric plc

Consolidated Balance Sheets



	December 31
In millions, except per-share data	2019			2018
Assets
Current assets
Cash and cash equivalents	$	106.4		$	159.0
Accounts and notes receivable, net of allowances of $5.4 and $6.1, respectively	334.3			340.9
Inventories	244.7			228.2
Other current assets	113.3			118.4
Total current assets	798.7			846.5
Property, plant and equipment, net	284.5			264.8
Other assets
Goodwill	2,279.1			2,234.3
Intangibles, net	1,160.5			1,173.3
Other non-current assets	117.5			33.8
Total other assets	3,557.1			3,441.4
Total assets	$	4,640.3		$	4,552.7
Liabilities and Equity
Current liabilities
Current maturities of long-term debt and short-term borrowings	$	17.5		$	12.5
Accounts payable	187.1			186.4
Employee compensation and benefits	71.9			75.8
Other current liabilities	185.7			187.0
Total current liabilities	462.2			461.7
Other liabilities
Long-term debt	1,047.1			929.2
Pension and other post-retirement compensation and benefits	207.2			177.9
Deferred tax liabilities	237.8			224.8
Other non-current liabilities	93.5			72.0
Total liabilities	2,047.8			1,865.6
Commitments and Contingencies (Note 16)
Equity
Ordinary shares $0.01 par value, 400.0 authorized, 169.5 and 177.2 issued at December 31, 2019 and 2018, respectively	1.7			1.8
Additional paid-in capital	2,502.7			2,709.7
Retained earnings	186.7			83.4
Accumulated other comprehensive loss	(98.6		)	(107.8		)
Total equity	2,592.5			2,687.1
Total liabilities and equity	$	4,640.3		$	4,552.7

See accompanying notes to consolidated and combined financial statements.

nVent Electric plc

Consolidated and Combined Statements of Cash Flows



	Years ended December 31
In millions	2019			2018			2017
Operating activities
Net income	$	222.7		$	230.8		$	361.7
Adjustments to reconcile net income to net cash provided by (used for) operating activities
Depreciation	35.4			36.2			36.5
Amortization	61.4			60.9			61.4
Deferred income taxes	(24.6		)	(23.6		)	(158.0		)
Share-based compensation	16.1			12.8			14.6
Impairment of trade names	—			—			16.4
Pension and other post-retirement expense	36.5			14.9			14.3
Pension and other post-retirement contributions	(5.8		)	(6.7		)	(6.7		)
Changes in assets and liabilities, net of effects of business acquisitions
Accounts and notes receivable	26.6			(1.3		)	(18.2		)
Inventories	0.9			(12.0		)	(8.9		)
Other current assets	10.2			7.3			5.6
Accounts payable	(7.9		)	13.4			17.0
Employee compensation and benefits	(6.6		)	6.8			11.6
Other current liabilities	(16.9		)	27.5			21.3
Other non-current assets and liabilities	(11.7		)	(23.5		)	41.1
Net cash provided by (used for) operating activities	336.3			343.5			409.7
Investing activities
Capital expenditures	(38.8		)	(39.5		)	(31.8		)
Proceeds from sale of property and equipment	6.3			2.4			4.2
Acquisitions, net of cash acquired	(127.8		)	(2.0		)	(13.6		)
Net cash provided by (used for) investing activities	(160.3		)	(39.1		)	(41.2		)
Financing activities
Net repayments of short-term borrowings	—			(0.3		)	—
Net receipts of revolving credit facility	134.6			—			—
Proceeds from long-term debt	—			1,000.0			—
Repayment of long-term debt	(14.1		)	(52.5		)	—
Debt issuance costs	—			(9.9		)	—
Cash provided at separation to former Parent	—			(993.6		)	—
Dividends paid	(120.7		)	(62.9		)	—
Net transfers to former Parent prior to separation	—			—			(359.5		)
Shares issued to employees, net of shares surrendered	9.5			8.6			—
Repurchases of ordinary shares	(235.7		)	(56.0		)	—
Net cash provided by (used for) financing activities	(226.4		)	(166.6		)	(359.5		)
Effect of exchange rate changes on cash and cash equivalents	(2.2		)	(5.7		)	(3.6		)
Change in cash and cash equivalents	(52.6		)	132.1			5.4
Cash and cash equivalents, beginning of year	159.0			26.9			21.5
Cash and cash equivalents, end of year	$	106.4		$	159.0		$	26.9

Supplemental cash flow information
Cash paid for interest, net	$	52.3		$	34.7		$	—
Cash paid for income taxes, net	$	60.8		$	57.4		$	—

See accompanying notes to consolidated and combined financial statements.

nVent Electric plc

Consolidated and Combined Statements of Changes in Equity



In millions	Ordinary shares					Additional paid-in capital			Retained earnings			Net Parent Investment			Accumulated other comprehensive loss			Total
	Number		Amount
Balance - December 31, 2016	—		$	—		$	—		$	—		$	3,546.3		$	(60.6	)	$	3,485.7
Net Income	—		—			—			—			361.7			—			361.7
Other comprehensive income, net of tax	—		—			—			—			—			3.5			3.5
Net transfers to former Parent	—		—			—			—			(59.6		)	—			(59.6		)
Balance - December 31, 2017	—		$	—		$	—		$	—		$	3,848.4		$	(57.1	)	$	3,791.3
Net Income	—		—			—			177.3			53.5			—			230.8
Cumulative effect of accounting changes	—		—			—			—			(172.7		)	—			(172.7		)
Other comprehensive income, net of tax	—		—			—			—			—			(50.7		)	(50.7		)
Net transfers from former Parent	—		—			—			—			14.6			—			14.6
Cash provided at separation to former Parent	—		—			—			—			(993.6		)	—			(993.6		)
Reclassification of Net Parent investment to additional paid-in capital	—		—			2,750.2			—			(2,750.2		)	—			—
Issuance of common stock upon separation	178.4		1.8			—			—			—			—			1.8
Dividends declared	—		—			—			(93.9		)	—			—			(93.9		)
Share repurchases	(2.4	)	—			(59.0		)	—			—			—			(59.0		)
Exercise of options, net of shares tendered for payment	1.0		—			12.1			—			—			—			12.1
Issuance of restricted shares, net of cancellations	0.4		—			—			—			—			—			—
Shares surrendered by employees to pay taxes	(0.2	)	—			(3.5		)	—			—			—			(3.5		)
Share-based compensation	—		—			9.9			—			—			—			9.9
Balance - December 31, 2018	177.2		$	1.8		$	2,709.7		$	83.4		$	—		$	(107.8	)	$	2,687.1
Net income	—		—			—			222.7			—			—			222.7
Other comprehensive income, net of tax	—		—			—			—			—			9.2			9.2
Dividends declared	—		—			—			(119.4		)	—			—			(119.4		)
Share repurchases	(8.9	)	(0.1		)	(232.6		)	—			—			—			(232.7		)
Exercise of options, net of shares tendered for payment	0.9		—			13.1			—			—			—			13.1
Issuance of restricted shares, net of cancellations	0.4		—			—			—			—			—			—
Shares surrendered by employees to pay taxes	(0.1	)	—			(3.6		)	—			—			—			(3.6		)
Share-based compensation	—		—			16.1			—			—			—			16.1
Balance - December 31, 2019	169.5		$	1.7		$	2,502.7		$	186.7		$	—		$	(98.6	)	$	2,592.5

See accompanying notes to consolidated and combined financial statements.

nVent Electric plc

Notes to consolidated and combined financial statements


1.	Basis of Presentation and Summary of Significant Accounting Policies

Business

nVent Electric plc ("nVent," "we," "us," "our" or the "Company") is a leading global provider of electrical connection and protection solutions. The Company is comprised of three reporting segments: Enclosures, Thermal Management and Electrical & Fastening Solutions.

Separation from Pentair

Except where indicated, references below to transactions completed by nVent prior to April 30, 2018 refer to transactions completed by or on behalf of the Electrical reporting segment of the former Parent that are reflected on the consolidated and combined financial statements of nVent.

Basis of presentation

The consolidated and combined financial statements have been prepared in U.S. dollars ("USD") and in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Intercompany accounts and transactions have been eliminated.

Cost allocations

For periods prior to the separation, the consolidated and combined financial statements of nVent include general corporate expenses of the former Parent for certain support functions that were provided on a centralized basis, such as expenses related to executive management, finance, audit, legal, information technology, human resources, communications, facilities and employee benefits and compensation. These general corporate expenses are included in the Consolidated and Combined Statements of Operations and Comprehensive Income within Selling, general and administrative expense and Other expense. The amounts allocated were $42.5 million and $65.7 million for the years ended December 31, 2018 and 2017, respectively, of which $10.3 million and $31.0 million, respectively, were historically recorded to the Electrical segment in the former Parent’s consolidated financial statements. These expenses were allocated to nVent on the basis of direct usage when identifiable, with the remainder allocated based on a proportional basis of net sales, headcount or other measures.

The Company considers the allocation methodology regarding general corporate expenses of the former Parent to be reasonable for all periods presented. Nevertheless, the consolidated and combined financial statements of nVent for periods prior to the separation may not reflect the actual expenses that would have been incurred and may not reflect nVent’s consolidated and combined results of operations, financial position and cash flows had it been a stand-alone company during the periods presented. Actual costs for periods prior to the separation that would have been incurred if nVent had been a stand-alone company would depend on multiple factors including organization structure, capital structure and strategic decisions made in various areas, including information technology and infrastructure. Transactions between nVent and the former Parent have been included in related party transactions in these consolidated and combined financial statements and were considered to be effectively settled at the time the transaction was recorded. The total net effect of the settlement of these transactions is reflected in the Consolidated and Combined Statements of Cash Flows as a financing activity.

nVent Electric plc

Notes to consolidated and combined financial statements

For periods prior to the separation, certain nVent operations were included in the former Parent's U.S. federal and state income tax returns and substantially all income taxes on those operations have been paid by the former Parent. Income tax expense and other income tax related information contained in these consolidated and combined financial statements for periods prior to the separation are presented on a separate return approach as if nVent filed its own tax returns. Under this approach, the provision for income taxes represented income tax paid or payable (or received or receivable) for the current year plus the change in deferred taxes during the year calculated as if nVent was a stand-alone taxpayer filing hypothetical income tax returns where applicable. Current income tax liabilities were assumed to be immediately settled with the former Parent and relieved through the Net Parent investment account and the Net transfers to former Parent in the Consolidated and Combined Statements of Cash Flows.

Fiscal year

Our fiscal year ends on December 31. We report our interim quarterly periods on a calendar quarter basis.

Use of estimates

The preparation of our consolidated and combined financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in these consolidated and combined financial statements and accompanying notes, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates include our accounting for valuation of goodwill and indefinite lived intangible assets, estimated losses on accounts receivable, estimated realizable value on excess and obsolete inventory, percentage of completion revenue recognition, assets acquired and liabilities assumed in acquisitions, contingent liabilities, income taxes and pension and other post-retirement benefits. Actual results could differ from our estimates.

Revenue recognition

Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for transferring those goods or providing services. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

When determining whether the customer has obtained control of the goods or services, we consider any future performance obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in Accounting Standards Codification 606 - Revenue from Contracts with Customers. Generally, there is no post-shipment obligation on product sold other than warranty obligations in the normal and ordinary course of business.

Contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts and, therefore, not distinct. For contracts with multiple performance obligations, stand-alone selling price is generally readily observable.

Our performance obligations are satisfied at a point in time or over time as work progresses. Revenue from products and services transferred to customers at a point in time accounted for 73% and 72% of our revenue for the years ended December 31, 2019 and 2018, respectively. Revenue on these contracts is recognized when obligations under the terms of the contract with our customer are satisfied; generally this occurs with the transfer of control upon shipment.

Revenue from products and services transferred to customers over time accounted for 27% and 28% of our revenue for the years ended December 31, 2019 and 2018, respectively. For the majority of our revenue recognized over time, we use an input measure to determine progress towards completion. Under this method, sales and gross profit are recognized as work is performed generally based on the relationship between the actual costs incurred and the total estimated costs at completion ("the cost-to-cost method") or based on efforts for measuring progress towards completion in situations in which this approach is more representative of the progress on the contract than the cost-to-cost method. Contract costs include labor, material, overhead and, when appropriate, general and administrative expenses. Changes to the original estimates may be required during the life of the contract and such estimates are reviewed on a regular basis. Sales and gross profit are adjusted using the cumulative catch-up method for revisions in estimated total contract costs. These reviews have not resulted in adjustments that were significant to our results of operations. For performance obligations related to long-term contracts, when estimates of total costs to be incurred on a performance obligation exceed total estimates of revenue to be earned, a provision for the entire loss on the performance obligation is recognized in the period the loss is determined.

We use an output method to measure progress towards completion for certain of our Enclosures businesses, as this method appropriately depicts performance towards satisfaction of the performance obligation. Under the output method, revenue is recognized based on number of units produced.

nVent Electric plc

Notes to consolidated and combined financial statements

We apply a practical expedient to expense incremental costs of obtaining a contract when incurred because the amortization period would be less than one year. These costs primarily relate to sales commissions and are recorded in Selling, general and administrative expense in the Consolidated and Combined Statements of Operations and Comprehensive Income. Further, we do not adjust the promised amount of consideration for the effects of a significant financing component if we expect, at contract inception, that the period between when we transfer a promised good or service to a customer and when the customer pays for that good or service will be less than one year.

Sales returns

The right of return may exist explicitly or implicitly with our customers. Our return policy allows for customer returns only upon our authorization. Goods returned must be product we continue to market and must be in salable condition. When the right of return exists, we adjust the transaction price for the estimated effect of returns. We estimate the expected returns based on historical sales levels, the timing and magnitude of historical sales return levels as a percent of sales, type of product, type of customer and a projection of this experience into the future.

Pricing and sales incentives

Our sales contracts may give customers the option to purchase additional goods or services priced at a discount. This can come in many forms, such as customer programs and incentive offerings including pricing arrangements, promotions and other volume-based incentives.

We reduce the transaction price for certain customer programs and incentive offerings including pricing arrangements, promotions and other volume-based incentives that represent variable consideration. Sales incentives given to our customers are recorded using either the expected value method or most likely amount approach for estimating the amount of consideration to which nVent shall be entitled. The expected value is the sum of probability-weighted amounts in a range of possible consideration amounts. An expected value is an appropriate estimate of the amount of variable consideration when there are a large number of contracts with similar characteristics. The most likely amount is the single most likely amount in a range of possible consideration amounts (that is, the single most likely outcome of the contract). The most likely amount is an appropriate estimate of the amount of variable consideration if the contract has limited possible outcomes (for example, an entity either achieves a performance bonus or does not).

Pricing is established at or prior to the time of sale with our customers and we record sales at the agreed-upon net selling price. However, certain of our businesses allow customers to apply for a refund of a percentage of the original purchase price if they can demonstrate sales to a qualifying end customer. We use the expected value method to estimate the anticipated refund to be paid based on historical experience and the transaction price is reduced for the probable cost of the discount.

Volume-based incentives involve rebates that are negotiated at or prior to the time of sale with the customer and are redeemable only if the customer achieves a specified cumulative level of sales or sales increase. Under these incentive programs, at the time of sale, we estimate the anticipated rebate to be paid based on forecasted sales levels. These forecasts are updated at least quarterly for each customer and the transaction price is reduced for the anticipated cost of the rebate. If the forecasted sales for a customer changes, the accrual for rebates is adjusted to reflect the new amount of rebates expected to be earned by the customer.

Shipping and handling costs

Amounts billed to customers for shipping and handling activities after the customer obtains control are treated as a promised service performance obligation and recorded in Net sales in the Consolidated and Combined Statements of Operations and Comprehensive Income. Shipping and handling costs incurred by nVent for the delivery of goods to customers are considered a cost to fulfill the contract and are included in Cost of goods sold in the Consolidated and Combined Statements of Operations and Comprehensive Income.

Contract assets and liabilities

Contract assets consist of unbilled amounts resulting from sales under long-term contracts when the cost-to-cost method of revenue recognition is utilized and revenue recognized exceeds the amount billed to the customer, such as when the customer retains a small portion of the contract price until completion of the contract. We typically receive interim payments on sales under long-term contracts as work progresses, although for some contracts, we may be entitled to receive an advance payment. Contract liabilities consist of advanced payments and billings in excess of costs incurred and deferred revenue.

Contract assets are recorded within Other current assets and contract liabilities are recorded within Other current liabilities in the Consolidated Balance Sheets.

Research and development

We conduct research and development (“R&D”) activities in our own facilities, which consist primarily of the development of new products, product applications and manufacturing processes.

nVent Electric plc

Notes to consolidated and combined financial statements

Cash equivalents

We consider highly liquid investments with original maturities of three months or less at the date of acquisition to be cash equivalents.

Trade receivables and concentration of credit risk

We record an allowance for doubtful accounts, reducing our receivables balance to an amount we estimate is collectible from our customers. Estimates used in determining the allowance for doubtful accounts are based on current trends, aging of accounts receivable, periodic credit evaluations of our customers' financial condition and historical collection experience. We generally do not require collateral. No customer receivable balances exceeded 10% of total net receivable balances as of December 31, 2019 or 2018.

Inventories

Inventories are stated at the lower of cost or net realizable value with substantially all inventories recorded using the first-in, first-out ("FIFO") cost method.

Property, plant and equipment, net

Property, plant and equipment is stated at historical cost. We compute depreciation by the straight-line method based on the following estimated useful lives:



	Years
Land improvements	5 to 20
Buildings and leasehold improvements	5 to 50
Machinery and equipment	3 to 15

Significant improvements that add to productive capacity or extend the lives of properties are capitalized. Costs for repairs and maintenance are charged to expense as incurred. When property is retired or otherwise disposed of, the recorded cost of the assets and their related accumulated depreciation are removed from the Consolidated Balance Sheets and any related gains or losses are included in income.

We review the recoverability of long-lived assets to be held and used, such as property, plant and equipment, when events or changes in circumstances occur that indicate the carrying value of the asset or asset group may not be recoverable. The assessment of possible impairment is based on our ability to recover the carrying value of the asset or asset group from the expected future pre-tax cash flows (undiscounted and without interest charges) of the related operations. If these cash flows are less than the carrying value of such asset or asset group, an impairment loss is recognized for the difference between estimated fair value and carrying value. Impairment losses on long-lived assets held for sale are determined in a similar manner, except that fair values are reduced for the cost to dispose of the assets. The measurement of impairment requires us to estimate future cash flows and the fair value of long-lived assets. We recorded no material impairment charges in 2019, 2018 or 2017.

The following table presents geographic Property, plant and equipment, net by region as of December 31:



In millions	2019		2018
U.S. & Canada	$	160.7	$	159.6
Mexico	42.1		39.7
EMEA ⁽¹⁾	75.0		58.1
Rest of World ⁽²⁾	6.7		7.4
Consolidated	$	284.5	$	264.8
⁽¹⁾ EMEA includes Europe, Middle East and Africa
⁽²⁾Rest of World includes Latin America and Asia-Pacific

Goodwill and identifiable intangible assets

Goodwill

nVent Electric plc

Notes to consolidated and combined financial statements

Goodwill is tested annually for impairment and is tested for impairment more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test is performed using a two-step process. In the first step, the fair value of each reporting unit is compared with the carrying amount of the reporting unit, including goodwill. If the estimated fair value is less than the carrying amount of the reporting unit there is an indication that goodwill impairment exists and a second step must be completed in order to determine the amount of the goodwill impairment, if any, which should be recorded. In the second step, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill. The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation.

We did not recognize any goodwill impairment losses in 2019, 2018, or 2017.

Identifiable intangible assets

Our primary identifiable intangible assets include customer relationships, trade names, proprietary technologies and patents. Identifiable intangibles with definite lives are amortized and those identifiable intangibles with indefinite lives are not amortized. Identifiable intangible assets that are subject to amortization are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Identifiable intangible assets not subject to amortization are tested for impairment annually or more frequently if events warrant. We complete our annual impairment test during the fourth quarter each year for those identifiable assets not subject to amortization.

There were no impairment charges recorded in 2019 or 2018 for identifiable intangible assets. During 2017, an impairment charge of $16.4 million was recorded related to certain trade names in Electrical & Fastening Solutions and Thermal Management. The impairment charge was recorded in Selling, general and administrative expense in our Consolidated and Combined Statements of Operations and Comprehensive Income.

Income taxes

We use the asset and liability approach to account for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. We maintain valuation allowances unless it is more likely than not that all or a portion of the deferred tax assets will be realized. Changes in valuation allowances from period to period are included in our tax provision in the period of change. We recognize the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is more likely than not to be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

nVent Electric plc

Notes to consolidated and combined financial statements

Pension and other post-retirement plans

We sponsor defined-benefit pension plans and a post-retirement health plan. The pension and other post-retirement benefit costs for these plans are determined from actuarial assumptions and methodologies, including discount rates and expected returns on plan assets. These assumptions are updated annually and are disclosed in Note 12.

Earnings per ordinary share

Basic earnings per share are computed by dividing net income by the weighted-average number of ordinary shares outstanding. Diluted earnings per share are computed by dividing net income by the weighted-average number of ordinary shares outstanding including the dilutive effects of ordinary share equivalents.

Derivative financial instruments

We recognize all derivatives, including those embedded in other contracts, as either assets or liabilities at fair value in our Consolidated Balance Sheets. If the derivative is designated and is effective as a cash-flow hedge, the effective portion of changes in the fair value of the derivative are recorded in Accumulated other comprehensive loss ("AOCI") as a separate component of equity in the Consolidated Balance Sheets and are recognized in the Consolidated and Combined Statements of Operations and Comprehensive Income when the hedged item affects earnings. For a derivative that is not designated as or does not qualify as a hedge, changes in fair value are reported in earnings immediately.

Gains and losses on net investment hedges are included in AOCI as a separate component of equity in the Consolidated Balance Sheets.

We use derivative instruments for the purpose of hedging interest rate and currency exposures, which exist as part of ongoing business operations. We do not hold or issue derivative financial instruments for trading or speculative purposes. All other contracts that contain provisions meeting the definition of a derivative also meet the requirements for the normal purchases and normal sales scope exception. Our policy is not to enter into contracts with terms that cannot be designated as normal purchases or sales. From time to time, we may enter into short duration foreign currency contracts to hedge foreign currency risks.

Fair value measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date:

Level 1: Valuation is based on observable inputs such as quoted market prices (unadjusted) for identical assets or liabilities in active markets.

Level 2: Valuation is based on inputs such as quoted market prices for similar assets or liabilities in active markets or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3: Valuation is based upon other unobservable inputs that are significant to the fair value measurement.

In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

nVent Electric plc

Notes to consolidated and combined financial statements

Foreign currency translation

The financial statements of subsidiaries located outside of the U.S. are generally measured using the local currency as the functional currency, except for certain corporate entities outside of the U.S. which are measured using USD. Assets and liabilities of these subsidiaries are translated at the rates of exchange at the balance sheet date. Income and expense items are translated at average monthly rates of exchange. The resultant translation adjustments are included in AOCI as a separate component of equity.

Adoption of new accounting standards

On January 1, 2019, we adopted Accounting Standards Update ("ASU") No. 2016-02, “Leases” using the alternative transition method and did not recast comparative periods in transition to the new standard. In addition, we elected the package of practical expedients permitted under the transition guidance, which among other things, allowed us to carry forward the historical lease classification. We also elected to apply the practical expedient to not separate non-lease components from the lease components for all leases. Accordingly, all costs associated with a lease contract are accounted for as lease cost. In addition, we did not elect to apply the hindsight practical expedient. Adoption of the new standard resulted in the recording of additional right-of-use assets and lease liabilities of $44.2 million, as of January 1, 2019. The adoption of the standard did not have a material impact on our Consolidated and Combined Statements of Operations and Comprehensive Income or our Consolidated and Combined Statements of Cash Flows. We implemented internal controls and key system functionality to enable the preparation of financial information upon adoption.

On January 1, 2018, we adopted ASU No. 2014-09, "Revenue from Contracts with Customers" and the related amendments (the "new revenue standard") using the modified retrospective method. As a result of adoption, the cumulative impact to our beginning equity at January 1, 2018 was $1.8 million. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. We expect the impact of the adoption of the new standard to be immaterial to our net income on an ongoing basis. The adoption of the new standard had an impact on our accounting for certain custom products manufactured by our Enclosures segment. Prior to the adoption of the standard revenue was recognized for these custom products upon shipment. However, as these products have no alternative use to the Company and we have an enforceable right to payment for our performance completed to date, revenue related to these custom products are now recognized over time. Additionally, the new revenue standard resulted in reclassifications on the Consolidated Balance Sheets related to accounting for sales returns. The impact of adoption of the new revenue standard on our Consolidated and Combined Statements of Operations and Comprehensive Income and Consolidated Balance Sheets was not material.

On January 1, 2018, we adopted ASU No. 2017-07, "Retirement Benefits-Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost." As a result of the adoption, the interest cost, expected return on plan assets and net actuarial gain/loss components of net periodic pension and post-retirement benefit cost have been reclassified from Selling, general and administrative expense to Other expense. Only the service cost component remains in Operating income and will be eligible for capitalization in assets on a prospective basis. The effect of the retrospective presentation change related to the net periodic cost of our defined benefit pension and other post-retirement plans on our Consolidated and Combined Statements of Operations and Comprehensive Income was a reclassification of $2.6 million of pension and post-retirement expense for the year ended December 31, 2017, from Selling, general and administrative expense to Other expense.

On January 1, 2018, we adopted ASU No. 2016-16, "Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory" using the modified retrospective method. The ASU requires the tax effects of all intra-entity sales of assets other than inventory to be recognized in the period in which the transaction occurs. The adoption resulted in a $174.5 million cumulative-effect adjustment recorded in equity as of the beginning of 2018 that reflects a $201.5 million reduction of non-current prepaid income tax assets, partially offset by the establishment of $27.0 million of deferred tax assets.

The cumulative effect of the changes made to our January 1, 2018 Combined Balance Sheets from the modified retrospective adoption of ASU 2016-16 and ASU 2014-09 was as follows:

nVent Electric plc

Notes to consolidated and combined financial statements



Combined Balance Sheets
In millions	Balance at December 31, 2017		Adjustments due to ASU 2016-16			Adjustments due to ASU 2014-09			Balance at January 1, 2018
Assets
Accounts and notes receivable, net	$	349.3	$	—		$	3.8		$	353.1
Inventories	224.1		—			(1.8		)	222.3
Other current assets	132.3		—			1.8			134.1
Other non-current assets	251.8		(174.5		)	—			77.3
Liabilities
Other current liabilities	141.3		—			3.8			145.1
Deferred tax liabilities	279.4		—			0.4			279.8
Equity
Net Parent investment	3,848.4		(174.5		)	1.8			3,675.7

nVent Electric plc

Notes to consolidated and combined financial statements

2.Revenue

Disaggregation of revenue

We disaggregate our revenue from contracts with customers by geographic location and vertical market, as we believe these best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Geographic net sales information, based on geographic destination of the sale, was as follows:



	Year ended December 31, 2019
In millions	Enclosures		Thermal Management		Electrical & Fastening Solutions		Total
U.S. and Canada	$	715.5	$	351.9	$	414.7	$	1,482.1
Developed Europe ⁽¹⁾	212.5		136.3		109.3		458.1
Developing ⁽²⁾	92.5		87.7		42.0		222.2
Other Developed ⁽³⁾	13.3		14.7		13.6		41.6
Total	$	1,033.8	$	590.6	$	579.6	$	2,204.0



	Year ended December 31, 2018
In millions	Enclosures		Thermal Management		Electrical & Fastening Solutions		Total
U.S. and Canada	$	704.3	$	351.4	$	397.8	$	1,453.5
Developed Europe ⁽¹⁾	202.7		174.4		110.8		487.9
Developing ⁽²⁾	101.0		80.9		47.1		229.0
Other Developed ⁽³⁾	11.7		16.5		15.0		43.2
Total	$	1,019.7	$	623.2	$	570.7	$	2,213.6
⁽¹⁾ Developed Europe includes Western Europe and Eastern Europe included in European Union.
⁽²⁾ Developing includes China, Eastern Europe not included in European Union, Latin America, Middle East and Southeast Asia.
⁽³⁾ Other Developed includes Australia and Japan.

Vertical net sales information was as follows:



	Year ended December 31, 2019
In millions	Enclosures		Thermal Management		Electrical & Fastening Solutions		Total
Industrial	$	623.2	$	224.5	$	114.7	$	962.4
Commercial & Residential	113.2		186.2		338.1		637.5
Energy	103.4		171.4		55.2		330.0
Infrastructure	194.0		8.5		71.6		274.1
Total	$	1,033.8	$	590.6	$	579.6	$	2,204.0



	Year ended December 31, 2018
In millions	Enclosures		Thermal Management		Electrical & Fastening Solutions		Total
Industrial	$	626.1	$	263.0	$	112.7	$	1,001.8
Commercial & Residential	87.5		187.7		329.7		604.9
Energy	103.4		166.9		52.1		322.4
Infrastructure	202.7		5.6		76.2		284.5
Total	$	1,019.7	$	623.2	$	570.7	$	2,213.6

nVent Electric plc

Notes to consolidated and combined financial statements

Contract balances

Contract assets and liabilities consisted of the following:



In millions	December 31, 2019		December 31, 2018		$ Change			% Change
Contract assets	$	69.4	$	74.4	$	(5.0	)	(6.7	%)
Contract liabilities	13.7		13.2		0.5			3.8	%
Net contract assets	$	55.7	$	61.2	$	(5.5	)	(9.0	%)



In millions	December 31, 2018		January 1, 2018		$ Change			% Change
Contract assets	$	74.4	$	69.9	$	4.5		6.4	%
Contract liabilities	13.2		14.3		(1.1		)	(7.7	%)
Net contract assets	$	61.2	$	55.6	$	5.6		10.1	%

The $5.5 million decrease in net contract assets from December 31, 2018 to December 31, 2019 and the $5.6 million increase in net contract assets from January 1, 2018 to December 31, 2018 were primarily the result of timing of milestone payments. The majority of our contract liabilities at December 31, 2018 and January 1, 2018 were recognized in revenue as of December 31, 2019 and December 31, 2018, respectively. There were no impairment losses recognized on our contract assets for the twelve months ended December 31, 2019 and 2018.

Remaining performance obligations

We have elected the practical expedient to disclose only the value of remaining performance obligations for contracts with an original expected length of one year or more. On December 31, 2019, we had $79.0 million of remaining performance obligations on contracts with original expected duration of one year or more. We expect to recognize the majority of our remaining performance obligations on these contracts within the next twelve to eighteen months.


3.	Restructuring

During 2019, 2018 and 2017, we initiated and continued execution of certain business restructuring initiatives aimed at reducing our fixed cost structure and realigning our business. Initiatives during the years ended December 31, 2019, 2018 and 2017, respectively, included a reduction in hourly and salaried headcount of approximately 425, 50 and 250 employees.

Restructuring related costs included in Selling, general and administrative expense in the Consolidated and Combined Statements of Operations and Comprehensive Income included costs for severance and other restructuring costs as follows:



	Years ended December 31
In millions	2019		2018		2017
Severance and related costs	$	19.6	$	7.3	$	16.0
Other	2.3		0.4		0.8
Total restructuring costs	$	21.9	$	7.7	$	16.8

Restructuring costs by reportable segment were as follows:



	Years ended December 31
In millions	2019		2018		2017
Enclosures	$	5.3	$	1.3	$	6.7
Thermal Management	6.6		2.8		7.5
Electrical & Fastening Solutions	2.2		1.9		2.6
Other	7.8		1.7		—
Consolidated	$	21.9	$	7.7	$	16.8

nVent Electric plc

Notes to consolidated and combined financial statements

Activity related to accrued severance and related costs recorded in Other current liabilities in the Consolidated Balance Sheets is summarized as follows:



	Years ended December 31
In millions	2019			2018
Beginning balance	$	3.8		$	5.1
Costs incurred	19.6			7.3
Cash payments and other	(13.9		)	(8.6		)
Ending balance	$	9.5		$	3.8


4.	Earnings Per Share

On April 30, 2018, Pentair completed the separation of its Electrical business, distributing to its shareholders one ordinary share of nVent for every ordinary share of Pentair held as of the record date of April 17, 2018. The computations of basic and diluted earnings per share for periods prior to the separation were calculated using the shares that were distributed to Pentair shareholders upon the separation.

Basic and diluted earnings per share were calculated as follows:



	Years ended December 31
In millions, except per share data	2019		2018		2017
Net income	$	222.7	$	230.8	$	361.7
Weighted average ordinary shares outstanding
Basic	171.6		178.6		179.0
Dilutive impact of stock options, restricted stock units and performance share units	1.4		2.2		2.2
Diluted	173.0		180.8		181.2
Earnings per ordinary share
Basic earnings per ordinary share	$	1.30	$	1.29	$	2.02
Diluted earnings per ordinary share	$	1.29	$	1.28	$	2.00
Anti-dilutive stock options excluded from the calculation of diluted earnings per share	2.1		1.0		0.4


5.	Acquisitions

On August 30, 2019, we completed the acquisition of Eldon Holding AB ("Eldon") for $127.8 million, net of cash acquired. Eldon, now part of our Enclosures segment, is an innovative European based manufacturer of enclosures that protect sensitive electrical, electronic and data and telecommunications components. The purchase price was funded primarily through borrowings under our Revolving Credit Facility (as defined in note 9).

The excess purchase price over tangible net assets and identified intangible assets acquired has been preliminarily allocated to goodwill in the amount of $45.1 million, none of which is expected to be deductible for income tax purposes. Identifiable intangible assets acquired included $46.7 million of definite-lived customer relationships with an estimated useful life of 17 years. During the quarter ended December 31, 2019, we further refined certain income tax and working capital accounts resulting in a $9.1 million decrease in goodwill compared to the preliminary provisional value that was recorded at September 30, 2019. The preliminary purchase price allocation is subject to further refinement, primarily related to the impacts associated with income taxes and other accruals, and may require significant adjustments to arrive at the final purchase price allocation.

Eldon's net sales for the period from the acquisition date to December 31, 2019 were $30.6 million. The pro forma impact of the acquisition is not material.

On February 10, 2020, we acquired substantially all of the assets of WBT LLC ("WBT") for approximately $30.0 million in cash, subject to purchase price adjustments and holdbacks. WBT is a U.S. based manufacturer of high-quality cable tray that will be marketed as part of the nVent CADDY product line within our Electrical and Fastening Solutions segment.

nVent Electric plc

Notes to consolidated and combined financial statements

6. Goodwill and Other Identifiable Intangible Assets

The changes in the carrying amount of goodwill by reportable segment were as follows:



In millions	December 31, 2018		Acquisitions/ divestitures		Foreign currency translation/other			December 31, 2019
Enclosures	$	272.0	$	45.1	$	(1.7	)	$	315.4
Thermal Management	924.1		—		1.4			925.5
Electrical & Fastening Solutions	1,038.2		—		—			1,038.2
Total goodwill	$	2,234.3	$	45.1	$	(0.3	)	$	2,279.1



In millions	December 31, 2017		Acquisitions/ divestitures		Foreign currency translation/other			December 31, 2018
Enclosures	$	274.8	$	—	$	(2.8	)	$	272.0
Thermal Management	927.1		—		(3.0		)	924.1
Electrical & Fastening Solutions	1,036.3		1.9		—			1,038.2
Total goodwill	$	2,238.2	$	1.9	$	(5.8	)	$	2,234.3

Identifiable intangible assets consisted of the following at December 31:



	2019							2018
In millions	Cost		Accumulated amortization			Net		Cost		Accumulated amortization			Net
Definite-life intangibles
Customer relationships	$	1,197.9	$	(326.1	)	$	871.8	$	1,149.7	$	(266.4	)	$	883.3
Proprietary technologies and patents	14.8		(7.4		)	7.4		14.8		(6.1		)	8.7
Total definite-life intangibles	1,212.7		(333.5		)	879.2		1,164.5		(272.5		)	892.0
Indefinite-life intangibles
Trade names	281.3		—			281.3		281.3		—			281.3
Total intangibles	$	1,494.0	$	(333.5	)	$	1,160.5	$	1,445.8	$	(272.5	)	$	1,173.3

Identifiable intangible asset amortization expense in 2019, 2018 and 2017 was $61.4 million, $60.9 million and $61.4 million, respectively.

There were no impairment charges recorded in 2019 or 2018. In 2017, we recorded impairment charges for trade name intangible assets of $16.4 million.

Estimated future amortization expense for identifiable intangible assets during the next five years is as follows:



In millions	2020		2021		2022		2023		2024
Estimated amortization expense	$	63.2	$	62.0	$	61.9	$	61.7	$	61.1

nVent Electric plc

Notes to consolidated and combined financial statements


7.	Supplemental Balance Sheet Information



	December 31
In millions	2019		2018
Inventories
Raw materials and supplies	$	67.1	$	63.1
Work-in-process	25.6		25.3
Finished goods	152.0		139.8
Total inventories	$	244.7	$	228.2
Other current assets
Contract assets	$	69.4	$	74.4
Prepaid expenses	32.5		31.7
Prepaid income taxes	9.0		9.1
Other current assets	2.4		3.2
Total other current assets	$	113.3	$	118.4
Property, plant and equipment, net
Land and land improvements	$	40.6	$	39.1
Buildings and leasehold improvements	181.6		172.6
Machinery and equipment	440.4		410.8
Construction in progress	16.5		14.6
Total property, plant and equipment	679.1		637.1
Accumulated depreciation and amortization	394.6		372.3
Total property, plant and equipment, net	$	284.5	$	264.8
Other non-current assets
Deferred compensation plan assets	$	17.3	$	23.1
Lease right-of-use assets	44.2		—
Deferred tax assets	40.9		4.6
Other non-current assets	15.1		6.1
Total other non-current assets	$	117.5	$	33.8
Other current liabilities
Dividends payable	$	29.7	$	31.0
Accrued rebates	44.1		46.1
Contract liabilities	13.7		13.2
Accrued taxes payable	24.8		27.4
Current lease liabilities	14.7		—
Other current liabilities	58.7		69.3
Total other current liabilities	$	185.7	$	187.0
Other non-current liabilities
Income taxes payable	$	31.9	$	41.9
Deferred compensation plan liabilities	17.3		23.1
Non-current lease liabilities	33.7		—
Other non-current liabilities	10.6		7.0
Total other non-current liabilities	$	93.5	$	72.0

nVent Electric plc

Notes to consolidated and combined financial statements


8.	Accumulated Other Comprehensive Income (Loss)

Components of AOCI consist of the following at December 31:



In millions	2019			2018
Cumulative translation adjustments	$	(100.5	)	$	(105.3	)
Change in market value of derivative financial instruments, net of tax	1.9			(2.5		)
Accumulated other comprehensive loss	$	(98.6	)	$	(107.8	)


9.	Debt

Debt and the average interest rates on debt outstanding were as follows:



In millions	Average interest rate at	Maturity year	December 31
In millions	December 31, 2019	Maturity year	2019			2018
Revolving credit facility	3.174%	2023	$	134.6		$	—
Senior notes - fixed rate	3.950%	2023	300.0			300.0
Senior notes - fixed rate	4.550%	2028	500.0			500.0
Term loan facility	3.160%	2023	135.0			147.5
Unamortized issuance costs and discounts	N/A	N/A	(5.0		)	(5.8		)
Total debt			1,064.6			941.7
Less: Current maturities and short-term borrowings			(17.5		)	(12.5		)
Long-term debt			$	1,047.1		$	929.2

Senior notes

In March 2018, nVent Finance S.à r.l. (“nVent Finance” or "Subsidiary Issuer"), a 100-percent owned subsidiary of nVent, issued $300.0 million aggregate principal amount of 3.950% senior notes due 2023 (the "2023 Notes") and $500.0 million aggregate principal amount of 4.550% senior notes due 2028 (the "2028 Notes" and, collectively with the 2023 Notes, the "Notes"). Interest on the Notes is payable semi-annually in arrears on April 15 and October 15 of each year.

The Notes are fully and unconditionally guaranteed as to payment by the Parent Company Guarantor. There are no subsidiaries that guarantee the Notes. The Parent Company Guarantor has no independent assets or operations unrelated to its investments in its consolidated subsidiaries. The Subsidiary Issuer has no independent assets or operations unrelated to its investments in its consolidated subsidiaries and the issuance of the Notes and other external debt.

nVent Electric plc

Notes to consolidated and combined financial statements

Senior credit facilities

In March 2018, nVent Finance entered into a credit agreement with a syndicate of banks providing for a five-year $200.0 million senior unsecured term loan facility (the "Term Loan Facility") and a five-year $600.0 million senior unsecured revolving credit facility (the "Revolving Credit Facility" and, together with the Term Loan Facility, the "Senior Credit Facilities"). We have the option to request to increase the Revolving Credit Facility in an aggregate amount of up to $300.0 million, subject to customary conditions, including the commitment of the participating lenders. Total availability under the Revolving Credit Facility was $465.4 million as of December 31, 2019.

Debt outstanding at December 31, 2019, excluding unamortized issuance costs and discounts, matures on a calendar year basis as follows:



In millions	2020		2021		2022		2023		2024		Thereafter		Total
Contractual debt obligation maturities	$	17.5	$	20.0	$	20.0	$	512.1	$	—	$	500.0	$	1,069.6


10.	Derivatives and Financial Instruments

Derivative financial instruments

We are exposed to market risk related to changes in foreign currency exchange rates. To manage the volatility related to this exposure, we periodically enter into a variety of derivative financial instruments. Our objective is to reduce, where it is deemed appropriate to do so, fluctuations in earnings and cash flows associated with changes in foreign currency exchange rates. The derivative contracts contain credit risk to the extent that our bank counterparties may be unable to meet the terms of the agreements. The amount of such credit risk is generally limited to the unrealized gains, if any, in such contracts. Such risk is minimized by limiting those counterparties to major financial institutions of high credit quality.

Foreign currency contracts

We conduct business in various locations throughout the world and are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S. dollar. We manage our economic and transaction exposure to certain market-based risks through the use of foreign currency derivative financial instruments. Our objective in holding these derivatives is to reduce the volatility in net earnings and cash flows associated with changes in foreign currency rates. The majority of our foreign currency contracts have an original maturity date of less than one year.

At December 31, 2019 and 2018, we had outstanding foreign currency derivative contracts with gross notional U.S. dollar equivalent amounts of $34.5 million and $28.4 million, respectively. The impact of these contracts on the Consolidated and Combined Statements of Operations and Comprehensive Income (Loss) was not material for any period presented.

Cross currency swaps

At December 31, 2019 and 2018, we had outstanding cross currency swap agreements with a combined notional amount of $303.5 million and $169.7 million, respectively. The agreements are accounted for as either cash flow hedges, to hedge foreign currency fluctuations on certain intercompany debt, or as net investment hedge, to manage our exposure to fluctuations in the Euro-U.S. Dollar exchange rate. The impact of the foreign currency activity in AOCI associated with the cross currency swaps was not material for any period presented.

nVent Electric plc

Notes to consolidated and combined financial statements

Fair value of financial instruments

The following methods were used to estimate the fair values of each class of financial instrument:


•	short-term financial instruments (cash and cash equivalents, accounts and notes receivable, accounts and notes payable and variable-rate debt) — recorded amount approximates fair value because of the short maturity period;


•	long-term fixed-rate debt, including current maturities — fair value is based on market quotes available for issuance of debt with similar terms, which are inputs that are classified as Level 2 in the valuation hierarchy defined by the accounting guidance;


•	foreign currency contract agreements — fair values are determined through the use of models that consider various assumptions, including time value, yield curves, as well as other relevant economic measures, which are observable inputs that are classified as Level 2 in the valuation hierarchy defined by the accounting guidance; and

•

deferred compensation plan assets (mutual funds, common/collective trusts and cash equivalents for payment of certain non-qualified benefits for retired, terminated and active employees) — fair value of mutual funds and cash equivalents are based on quoted market prices in active markets that are classified as Level 1 in the valuation hierarchy defined by the accounting guidance; fair value of common/collective trusts are valued at net asset value ("NAV"), which is based on the fair value of the underlying securities owned by the fund divided by the number of shares outstanding.

The recorded amounts and estimated fair values of total debt, excluding unamortized issuance costs and discounts, at December 31 were as follows:



	2019				2018
In millions	Recorded Amount		Fair Value		Recorded Amount		Fair Value
Variable rate debt	$	269.6	$	269.6	$	147.5	$	147.5
Fixed rate debt	800.0		863.5		800.0		793.5
Total debt	$	1,069.6	$	1,133.1	$	947.5	$	941.0

Financial assets and liabilities measured at fair value on a recurring basis at December 31 were as follows:



Recurring fair value measurements	2019
In millions	Level 1		Level 2			Level 3		NAV		Total
Foreign currency contract liabilities	$	—	$	(3.4	)	$	—	$	—	$	(3.4	)
Foreign currency contract assets	—		7.6			—		—		7.6
Deferred compensation plan assets	12.8		—			—		4.5		17.3
Total recurring fair value measurements	$	12.8	$	4.2		$	—	$	4.5	$	21.5



Recurring fair value measurements	2018
In millions	Level 1		Level 2			Level 3		NAV		Total
Foreign currency contract liabilities	$	—	$	(2.6	)	$	—	$	—	$	(2.6	)
Deferred compensation plan assets	19.1		—			—		4.0		23.1
Total recurring fair value measurements	$	19.1	$	(2.6	)	$	—	$	4.0	$	20.5

nVent Electric plc

Notes to consolidated and combined financial statements


11.	Income Taxes

Income before income taxes consisted of the following:



	Years ended December 31
In millions	2019			2018			2017
Federal ⁽¹⁾	$	(21.1	)	$	(20.4	)	$	(19.9	)
International ⁽²⁾	278.5			289.1			333.2
Income before income taxes	$	257.4		$	268.7		$	313.3


⁽¹⁾	"Federal" reflects United Kingdom ("U.K.") income before income taxes.


⁽²⁾	"International" reflects non-U.K. income before income taxes.

The provision for income taxes consisted of the following:



	Years ended December 31
In millions	2019			2018			2017
Currently payable
Federal ⁽¹⁾	$	—		$	—		$	1.0
International ⁽²⁾	55.6			47.0			94.5
Total current taxes	55.6			47.0			95.5
Deferred
International ⁽²⁾	(20.9		)	(9.1		)	(143.9		)
Total deferred taxes	(20.9		)	(9.1		)	(143.9		)
Total provision (benefit) for income taxes	$	34.7		$	37.9		$	(48.4	)


⁽¹⁾	"Federal" represents U.K. taxes.


⁽²⁾	"International" represents non-U.K. taxes.

Reconciliations of the federal statutory income tax rate to our effective tax rate were as follows:



	Years ended December 31
Percentages	2019		2018		2017
Federal statutory income tax rate ⁽¹⁾	19.0	%	19.0	%	19.3	%
Tax effect of international operations ⁽²⁾	(1.8	)	(5.8	)	(5.9	)
Change in valuation allowances	(3.6	)	0.9		(2.2	)
Non-deductible transaction costs	—		—		0.5
Excess tax benefits on stock-based compensation	(0.1	)	—		(0.1	)
Tax effect of U.S. tax reform	—		—		(27.0	)
Effective tax rate	13.5	%	14.1	%	(15.4	%)


⁽¹⁾	The statutory rate for 2019, 2018 and 2017 reflects the U.K. statutory rate of 19.0%, 19.0% and 19.3%, respectively.


⁽²⁾	The tax effect of international operations consists of non-U.K. jurisdictions.

nVent Electric plc

Notes to consolidated and combined financial statements

Reconciliations of the beginning and ending gross unrecognized tax benefits were as follows:



	Years ended December 31
In millions	2019			2018			2017
Beginning balance	$	16.8		$	24.6		$	26.6
Gross increases for tax positions in prior periods	0.3			2.3			1.2
Gross decreases for tax positions in prior periods	(1.3		)	(1.6		)	(2.2		)
Gross increases based on tax positions related to the current year	1.8			1.2			1.3
Gross decreases related to settlements with taxing authorities	(0.2		)	(8.0		)	(2.3		)
Reductions due to statute expiration	(0.1		)	(1.9		)	(1.3		)
Gross increases (decreases) due to currency fluctuations	(0.3		)	0.2			1.3
Ending balance	$	17.0		$	16.8		$	24.6

We record gross unrecognized tax benefits in Other current liabilities and Other non-current liabilities in the Consolidated Balance Sheets. Included in the $17.0 million of total gross unrecognized tax benefits as of December 31, 2019 was $15.7 million of tax benefits that, if recognized, would impact the effective tax rate. It is reasonably possible that the gross unrecognized tax benefits as of December 31, 2019 may decrease by a range of zero to $3.0 million during 2020, primarily as a result of the resolution of non-U.K. examinations and the expiration of various statutes of limitations.

Based on the outcome of tax examinations, or as a result of the expiration of statute of limitations for specific jurisdictions, it is reasonably possible that certain unrecognized tax benefits for tax positions taken on previously filed tax returns will materially change from those recorded as liabilities in our financial statements. A number of tax periods from 2008 to present are under audit by tax authorities in various jurisdictions, including Canada, China, France, Germany and Romania. We anticipate that several of these audits may be concluded in the foreseeable future.

We record penalties and interest related to unrecognized tax benefits in Provision (benefit) for income taxes and Net interest expense, respectively, in the Consolidated and Combined Statements of Operations and Comprehensive Income. As of December 31, 2019 and 2018, we have liabilities of $1.7 million and $1.7 million, respectively, for the possible payment of penalties and $3.0 million and $2.7 million, respectively, for the possible payment of interest expense, which are recorded in Other current liabilities in the Consolidated Balance Sheets.

No additional income taxes have been provided for any undistributed foreign earnings or outside basis difference inherent in subsidiaries as these amounts continue to be indefinitely reinvested in foreign operations.

Deferred taxes arise because of different treatment between financial statement accounting and tax accounting, known as "temporary differences." We record the tax effect of these temporary differences as "deferred tax assets" (generally items that can be used as a tax deduction or credit in future periods) and "deferred tax liabilities" (generally items for which we received a tax deduction but the tax impact has not yet been recorded in the Consolidated and Combined Statements of Operations and Comprehensive Income).

Deferred taxes were recorded in the Consolidated Balance Sheets at December 31 as follows:



In millions	2019		2018
Other non-current assets	$	40.9	$	4.6
Deferred tax liabilities	237.8		224.8
Net deferred tax liabilities	$	196.9	$	220.2

nVent Electric plc

Notes to consolidated and combined financial statements

The tax effects of the major items recorded as deferred tax assets and liabilities at December 31 were as follows:



In millions	2019		2018
Deferred tax assets
Accrued liabilities and reserves	$	10.4	$	10.6
Pension and other post-retirement compensation and benefits	36.9		26.8
Employee compensation and benefits	11.8		12.8
Tax loss and credit carryforwards	138.1		143.0
Interest limitation	20.0		7.7
Other assets	9.0		—
Total deferred tax assets	226.2		200.9
Valuation allowance	125.3		137.8
Deferred tax assets, net of valuation allowance	100.9		63.1
Deferred tax liabilities
Property, plant and equipment	17.6		15.3
Goodwill and other intangibles	262.2		260.4
Other liabilities	18.0		7.6
Total deferred tax liabilities	297.8		283.3
Net deferred tax liabilities	$	196.9	$	220.2

Included in tax loss and credit carryforwards in the table above is a deferred tax asset of $3.1 million as of December 31, 2019 related to foreign tax credit carryover from the tax period ended December 31, 2017 and related to transition taxes. The entire amount is subject to a valuation allowance. The foreign tax credit is eligible for carryforward until the tax period ending December 31, 2027.

As of December 31, 2019, tax loss carryforwards of $460.7 million were available to offset future income. A valuation allowance of $117.0 million exists for deferred income tax benefits related to the tax loss carryforwards which may not be realized. We believe sufficient taxable income will be generated in the respective jurisdictions to allow us to fully recover the remainder of the tax losses. The tax losses relate to non-U.S. carryforwards which are subject to varying expiration periods. Non-U.S. carryforwards of $423.5 million are located in jurisdictions with unlimited tax loss carryforward periods, while the remainder will begin to expire in 2020.

On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial system and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017.

We recorded an income tax benefit of $84.8 million in the fourth quarter of 2017, the period in which the legislation was enacted. The amount related to the remeasurement of certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future was a decrease to income tax expense of $122.0 million. Upon completion of our analysis of the impact of the Act, there were no adjustments to the amount recorded at December 31, 2017.

The amount related to the one-time transition tax on the mandatory deemed repatriation of foreign earnings was an increase to income tax expense of $32.9 million, which represents a decrease of $4.3 million compared to the provisional amount recorded at December 31, 2017.


12.	Benefit Plans

Pension and other post-retirement plans

We sponsor U.S. and non-U.S. defined-benefit pension and other post-retirement plans ("Direct Plans"). The defined benefit pension plans cover certain non-U.S. employees and retirees, and the pension benefits are based principally on an employee's years of service and/or compensation levels near retirement. In addition, we provide certain post-retirement health care and life insurance benefits. Generally, the post-retirement health care and life insurance plans require contributions from retirees.

nVent Electric plc

Notes to consolidated and combined financial statements

For periods prior to the separation, certain nVent employees participated in defined benefit pension plans and post-retirement health plans sponsored by the former Parent. For purposes of these consolidated and combined financial statements, nVent accounted for these plans as multi-employer benefit plans. Accordingly, the Company did not record an asset or liability to recognize the funded status of these plans. However, for periods prior to the separation, the Company recorded expense attributable to its employees who participate in these plans, as well as expense allocated for the former Parent’s corporate and shared functional employees. The total allocated expense was $2.7 million and $11.1 million for the years ended December 31, 2018 and 2017, respectively.

The following information is applicable to only Direct Plans.

Obligations and funded status

The following tables present reconciliations of plan benefit obligations, fair value of plan assets and the funded status of pension plans and other post-retirement plans as of and for the years ended December 31, 2019 and 2018:



	Pension plans						Post-retirement health plan
In millions	2019			2018			2019			2018
Change in benefit obligations
Benefit obligation beginning of year	$	199.5		$	195.3		$	16.2		$	18.2
Service cost	5.9			5.8			0.1			0.1
Interest cost	4.0			4.2			0.6			0.6
Benefit obligations from new plans	—			1.6			—			—
Plan settlements	(0.5		)	—			—			—
Actuarial loss (gain)	27.3			5.0			1.5			(2.0		)
Foreign currency translation	(4.2		)	(8.0		)	—			—
Benefits paid	(5.0		)	(4.4		)	(1.1		)	(0.7		)
Plan transfer	(16.2		)	—			—			—
Benefit obligation end of year	$	210.8		$	199.5		$	17.3		$	16.2
Change in plan assets
Fair value of plan assets beginning of year	$	41.8		$	42.2		$	—		$	—
Actual return on plan assets	3.0			(0.6		)	—			—
Assets from new plans	—			0.7			—			—
Company contributions	5.2			6.1			1.1			0.6
Plan settlements	(0.5		)	—			—			—
Foreign currency translation	0.4			(2.2		)	—			—
Benefits paid	(5.0		)	(4.4		)	(1.1		)	(0.6		)
Plan transfer	(16.2		)	—			—			—
Fair value of plan assets end of year	$	28.7		$	41.8		$	—		$	—
Funded status
Fair value of plan assets end of year	$	28.7		$	41.8		$	—		$	—
Benefit obligation end of year	210.8			199.5			17.3			16.2
Benefit obligations in excess of the fair value of plan assets	$	(182.1	)	$	(157.7	)	$	(17.3	)	$	(16.2	)

In the fourth quarter of 2019, we transferred all of our remaining benefit obligations and plan assets attributed to a pension plan in the U.K. to a third-party insurance company purchased through an annuity contract. The transfer of benefit obligations and plan assets are reflected in the Plan transfer lines in the table above.

nVent Electric plc

Notes to consolidated and combined financial statements

Amounts recorded in the Consolidated Balance Sheets at December 31 were as follows:



	Pension plans						Post-retirement health plan
In millions	2019			2018			2019			2018
Other non-current assets	$	1.7		$	1.0		$	—		$	—
Current liabilities	(3.7		)	(3.8		)	(1.2		)	(1.2		)
Non-current liabilities	(180.1		)	(154.9		)	(16.1		)	(15.0		)
Benefit obligations in excess of the fair value of plan assets	$	(182.1	)	$	(157.7	)	$	(17.3	)	$	(16.2	)

The accumulated benefit obligation for all defined benefit plans was $199.5 million and $191.2 million at December 31, 2019 and 2018, respectively.

Information for pension plans with an accumulated benefit obligation or projected benefit obligation in excess of plan assets as of December 31 was as follows:



	Projected benefit obligation exceeds the fair value of plan assets				Accumulated benefit obligation exceeds the fair value of plan assets
In millions	2019		2018		2019		2018
Projected benefit obligation	$	198.3	$	188.7	$	198.3	$	185.8
Fair value of plan assets	14.6		30.0		14.6		27.4
Accumulated benefit obligation	N/A		N/A		187.1		177.8

Components of net periodic benefit expense for our pension plans were as follows:



	Years ended December 31
In millions	2019			2018			2017
Service cost	$	5.9		$	5.8		$	6.3
Interest cost	4.0			4.2			4.0
Expected return on plan assets	(1.1		)	(1.4		)	(1.4		)
Net actuarial loss (gain)	25.4			7.5			(6.8		)
Net periodic benefit expense	$	34.2		$	16.1		$	2.1

Components of net periodic benefit expense for our post-retirement plan for the years ended December 31, 2019, 2018 and 2017, were not material.

Assumptions

Weighted-average assumptions used to determine benefit obligations as of December 31 were as follows:



	Pension plans						Post-retirement health plan
Percentages	2019		2018		2017		2019		2018		2017
Discount rate	1.54	%	2.25	%	2.25	%	3.08	%	4.10	%	3.40	%
Rate of compensation increase	2.97	%	2.97	%	2.98	%	—		—		—

Weighted-average assumptions used to determine net periodic benefit expense for years ended December 31 were as follows:



	Pension plans						Post-retirement health plan
Percentages	2019		2018		2017		2019		2018		2017
Discount rate	2.25	%	2.25	%	2.06	%	4.10	%	3.40	%	3.80	%
Expected long-term return on plan assets	4.15	%	3.45	%	3.38	%	—		—		—
Rate of compensation increase	2.97	%	2.98	%	2.97	%	—		—		—

nVent Electric plc

Notes to consolidated and combined financial statements

Uncertainty in the securities markets and U.S. economy could result in investment returns less than those assumed. Should the securities markets decline or medical and prescription drug costs increase at a rate greater than assumed, we would expect increasing annual combined net pension and other post-retirement costs for the next several years. Should actual experience differ from actuarial assumptions, the projected pension benefit obligation and net pension cost and accumulated other post-retirement benefit obligation and other post-retirement benefit cost would be affected in future years.

Discount rates

The discount rate reflects the current rate at which the pension liabilities could be effectively settled at the end of the year based on our December 31 measurement date. The discount rates on our pension plans ranged from 0.25% to 3.25%, 0.50% to 4.25% and 0.50% to 3.50% in 2019, 2018 and 2017, respectively. The discount rates are determined by matching high-quality, fixed-income debt instruments with maturities corresponding to the expected timing of benefit payments as of the annual measurement date for each of the various plans. There are no known or anticipated changes in our discount rate assumptions that will materially impact our pension expense in 2020.

Expected rates of return

The expected rates of return on our pension plan assets ranged from 1.00% to 5.25%, 1.00% to 5.50% and 1.00% to 5.50% in 2019, 2018 and 2017, respectively. The expected rate of return is designed to be a long-term assumption that may be subject to considerable year-to-year variance from actual returns. In developing the expected long-term rate of return, we considered our historical returns, with consideration given to forecasted economic conditions, our asset allocations, input from external consultants and broader longer-term market indices. Any difference in the expected rate and actual returns will be included with the actuarial gain or loss recorded in the fourth quarter when our plans are remeasured.

Pension plans assets

Objective

The primary objective of our investment strategy is to meet the pension obligation to our employees at a reasonable cost to us. This is primarily accomplished through growth of capital and safety of the funds invested.

Asset allocation

The majority of our pension plan assets are invested in fixed income and equity securities which is consistent with our investment policy goals. Actual investments for our pension plans as of December 31 were as follows:



	Actual
Percentages	2019		2018
Equity securities	43	%	23	%
Fixed income	42	%	65	%
Alternative investments	11	%	8	%
Cash equivalents	4	%	4	%

Fair value measurement

The fair values of our pension plan assets as of December 31 were as follows:



In millions	2019		2018
Cash equivalents	$	1.2	$	1.5
Fixed income:
Corporate and non U.S. government	11.9		27.1
Other investments (alternative investments)	3.1		3.5
Total investments at fair value	$	16.2	$	32.1
Investments measured at net asset value (equity securities)	12.5		9.7
Total	$	28.7	$	41.8

nVent Electric plc

Notes to consolidated and combined financial statements

Valuation methodologies used for investments measured at fair value, each of which is classified as Level 2 in the fair value hierarchy, were as follows:


•	cash equivalents — Cash equivalents consist of investments in commingled funds valued based on observable market data.

•

fixed income — Investments in corporate bonds, government securities, mortgages and asset backed securities were valued based upon quoted market prices for similar securities and other observable market data. Investments in commingled funds were generally valued at the net asset value of units held at the end of the period based upon the value of the underlying investments as determined by quoted market prices or by a pricing service.


•	other investments — Other investments include investments in commingled funds with diversified investment strategies. Investments in commingled funds were valued at the net asset value of units held at the end of the period based upon the value of the underlying investments as determined by quoted market prices or by a pricing service.

Cash flows

Contributions

Pension contributions to the Direct Plans totaled $5.2 million and $6.1 million in 2019 and 2018, respectively. The 2020 expected contributions will equal or exceed our minimum funding requirements of $6.7 million.

Estimated future benefit payments

The following benefit payments, which reflect expected future service or payout from termination, as appropriate, are expected to be paid by the plans for the years ended December 31 as follows:



In millions	Pension plans		Post-retirement health plan
2020	$	4.6	$	1.2
2021	5.0		1.2
2022	7.4		1.2
2023	5.2		1.2
2024	6.9		1.2
Thereafter	37.2		5.3

Savings plan

Effective January 1, 2019, nVent established and is the plan sponsor of a 401(k) retirement plan (nVent Management Company Retirement Savings and Incentive Plan or "401(k) plan") and employee share ownership plan (nVent Electric plc Employee Stock Purchase and Bonus Plan). The 401(k) plan covers certain union and all non-union U.S. employees who met certain age requirements. Under the 401(k) plan, eligible U.S. employees could voluntarily contribute a percentage of their eligible compensation and we match contributions made by employees who met certain eligibility and service requirements. The eligibility criteria and benefits provided by the plans sponsored by nVent are consistent with the provisions of the plans sponsored by the former Parent. During 2019, the matching contribution was 100% of eligible employee contributions for the first 5% of eligible contributions contributed as pre-tax contribution. Expense for the 401(k) plan was $10.9 million in 2019.

During 2018 and 2017, certain U.S. nVent employees were eligible to participate in a 401(k) plan with an employee share ownership ("ESOP") bonus component, sponsored by the former Parent. During 2017, the matching contribution was 100% of eligible employee contributions for the first 1% of eligible compensation and 50% of the next 5% of eligible compensation. In addition to the matching contribution, all employees who met certain service requirements received a discretionary ESOP contribution equal to 1.5% of annual eligible compensation. During 2018, the matching contribution was 100% of eligible employee contributions for the first 5% of eligible contributions contributed as pre-tax contribution. Expense was $10.5 million in 2018, and the allocated expense for the Company was $7.1 million in 2017.


13.	Shareholders' Equity

Authorized shares

Our authorized share capital consists of 400.0 million ordinary shares with a par value of $0.01 per share.

nVent Electric plc

Notes to consolidated and combined financial statements

Share repurchases

On July 23, 2018, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $500.0 million (the "2018 Authorization"). On February 19, 2019, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $380.0 million (the "2019 Authorization"). The 2018 and 2019 Authorizations expire on July 23, 2021.

During the year ended December 31, 2018, we repurchased 2.4 million of our ordinary shares for $59.0 million under the 2018 authorization. During the year ended December 31, 2019, we repurchased 9.0 million of our ordinary shares for $232.7 million under the 2018 Authorization. As of December 31, 2019 and 2018, outstanding share repurchases recorded in Accounts payable were zero and $3.0 million, respectively.

As of December 31, 2019, we had $588.3 million available for repurchases under the 2018 and 2019 Authorizations, which totaled $880.0 million.

Dividends

Dividends paid per ordinary share were $0.70 and $0.35 for the years ended December 31, 2019 and 2018, respectively.


14.	Segment Information

We classify our operations into the following business segments based primarily on types of products offered and markets served:

•

Enclosures — The Enclosures segment provides inventive solutions that protect, connect and manage heat in critical electronics, communication, control, and power equipment. From metallic and non-metallic enclosures to cabinets, subracks and backplanes, it offers the physical infrastructure to host, connect and protect server and network equipment, as well as indoor and outdoor protection for test and measurement, aerospace and defense applications in industrial, infrastructure, energy and commercial verticals.

•

Thermal Management —The Thermal Management segment provides electric thermal solutions that connect and protect critical buildings, infrastructure, industrial processes and people. Its thermal management systems include heat tracing, floor heating, fire-rated and specialty wiring, sensing and snow melting and de-icing solutions for use in industrial, commercial & residential, energy and infrastructure verticals. It's highly reliable and easy to install solutions lower total cost of ownership to building owners, facility managers, operators and end users.

•

Electrical & Fastening Solutions — The Electrical & Fastening Solutions segment provides fastening solutions that connect and protect electrical and mechanical systems and civil structures. Its engineered electrical and fastening products are innovative cost efficient and labor saving connections that are used across a wide range of verticals, including commercial, industrial, infrastructure and energy.

Other — Other is primarily composed of unallocated corporate expenses, our captive insurance subsidiary and intermediate finance companies.

The accounting policies of our reporting segments are the same as those described in the summary of significant accounting policies. We evaluate performance based on the net sales and segment income (loss) and use a variety of ratios to measure performance of our reporting segments. These results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. Segment income (loss) represents operating income exclusive of intangible amortization, separation costs, costs of restructuring activities, "mark-to-market" gain/loss for pension and other post-retirement plans, impairments and other unusual non-operating items.

nVent Electric plc

Notes to consolidated and combined financial statements

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



	Net sales						Segment income (loss)
In millions	2019		2018		2017		2019			2018			2017
Enclosures	$	1,033.8	$	1,019.7	$	934.9	$	181.3		$	174.8		$	164.6
Thermal Management	590.6		623.2		622.2		145.3			154.2			147.3
Electrical & Fastening Solutions	579.6		570.7		540.8		149.7			144.5			140.7
Other	—		—		—		(52.0		)	(49.1		)	(29.6		)
Consolidated	$	2,204.0	$	2,213.6	$	2,097.9	$	424.3		$	424.4		$	423.0

No customer accounted for more than 10% of net sales in 2019, 2018, or 2017.



	Identifiable assets						Depreciation
In millions	2019		2018		2017		2019		2018		2017
Enclosures	$	787.0	$	665.9	$	672.3	$	16.1	$	15.9	$	16.0
Thermal Management	1,543.7		1,557.1		1,800.9		7.9		8.6		8.7
Electrical & Fastening Solutions	2,129.3		2,157.7		2,189.0		9.1		10.1		9.6
Other	180.3		172.0		62.8		2.3		1.6		2.2
Consolidated	$	4,640.3	$	4,552.7	$	4,725.0	$	35.4	$	36.2	$	36.5



	Capital expenditures
In millions	2019		2018		2017
Enclosures	$	15.3	$	13.3	$	21.7
Thermal Management	6.8		5.1		4.9
Electrical & Fastening Solutions	13.3		7.9		5.2
Other	3.4		13.2		—
Consolidated	$	38.8	$	39.5	$	31.8

The following table presents a reconciliation of consolidated and combined segment income to consolidated and combined income before income taxes for the years ended December 31:



In millions	2019			2018			2017
Segment income	$	424.3		$	424.4		$	423.0
Restructuring and other	(24.2		)	(7.7		)	(13.0		)
Intangible amortization	(61.4		)	(60.9		)	(61.4		)
Pension and other post-retirement mark-to-market (loss) gain	(27.3		)	(7.0		)	3.0
Acquisition transaction and integration costs	(2.4		)	—			—
Inventory step-up amortization	(3.2		)	—			—
Trade name impairment	—			—			(16.4		)
Separation costs	—			(45.0		)	(16.1		)
Interest expense, net	(44.7		)	(31.2		)	(0.2		)
Other expense	(3.7		)	(3.9		)	(5.6		)
Income before income taxes	$	257.4		$	268.7		$	313.3

nVent Electric plc

Notes to consolidated and combined financial statements


15.	Leases

We have operating leases for office space, production facilities, distribution centers, warehouses, sales offices, fleet vehicles and equipment. In accordance with our accounting policy, leases with an initial term of 12 months or less are not recognized on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. We elected the practical expedient for all leases to include both lease and non-lease components within our lease assets and lease liabilities.

Our lease agreements do not contain any material residual value guarantees, any material bargain purchase options or material restrictive covenants. We have no material sublease arrangements with third parties or lease transactions with related parties.

During the years ended December 31, 2019, 2018 and 2017, rent expense was $19.8 million, $15.8 million and $17.6 million, respectively, primarily related to operating lease costs. Costs associated with short-term leases, variable rent and subleases were immaterial.

Our leases have remaining lease terms of one to ten years, some of which include options to extend the leases for up to five years. Renewal options that are reasonably certain to be exercised are included in the lease term. The incremental borrowing rate is used in determining the present value of lease payments, unless an implicit rate is specified. Incremental borrowing rates on a collateralized basis are determined based on the economic environment in which leases are denominated and the lease term. The weighted average remaining lease term and weighted average discount rate as of December 31, 2019 were as follows:



	December 31, 2019
Weighted average remaining lease term
Operating leases	5 years
Weighted average discount rate
Operating leases	4.0	%

Future lease payments under non-cancelable operating leases as of December 31, 2019 were as follows:



In millions
2020	$	16.7
2021	11.4
2022	7.5
2023	4.4
2024	3.5
Thereafter	10.9
Total lease payments	54.4
Less imputed interest	(6.0		)
Total reported lease liability	$	48.4

As of December 31, 2019, we have no material additional operating leases that have not yet commenced.

Future minimum lease commitments under non-cancelable operating leases based on accounting standards applicable as of December 31, 2018 were as follows:



In millions
2019	$	16.2
2020	12.6
2021	8.0
2022	5.6
2023	2.7
Thereafter	9.6
Total	$	54.7

nVent Electric plc

Notes to consolidated and combined financial statements

Supplemental cash flow information related to operating leases was as follows:



	Year ended
In millions	December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities	$	18.0
Lease right-of-use assets obtained in exchange for new lease liabilities	15.5

Supplemental balance sheet information related to operating leases was as follows:



In millions	Classification	December 31, 2019		January 1, 2019
Assets
Lease right-of-use assets	Other non-current assets	$	44.2	$	44.2
Liabilities
Current lease liabilities	Other current liabilities	$	14.7	$	13.6
Non-current lease liabilities	Other non-current liabilities	33.7		34.8
Total lease liabilities		$	48.4	$	48.4


16.	Commitments and Contingencies

Warranties and guarantees

In connection with the disposition of our businesses or product lines, we may agree to indemnify purchasers for various potential liabilities relating to the sold business, such as pre-closing tax, product liability, warranty, environmental, or other obligations. The subject matter, amounts and duration of any such indemnification obligations vary for each type of liability indemnified and may vary widely from transaction to transaction.

Generally, the maximum obligation under such indemnifications is not explicitly stated and as a result, the overall amount of these obligations cannot be reasonably estimated. Historically, we have not made significant payments for these indemnifications. We believe that if we were to incur a loss in any of these matters, the loss would not have a material effect on our financial position, results of operations or cash flows.

We recognize, at the inception of a guarantee, a liability for the fair value of the obligation undertaken in issuing the guarantee.

We provide service and warranty policies on our products. Liability under service and warranty policies is based upon a review of historical warranty and service claim experience. Adjustments are made to accruals as claim data and historical experience warrant. Our liability for service and product warranties as of December 31, 2019 and 2018 was not material.

Stand-by letters of credit, bank guarantees and bonds

In disposing of assets or businesses, we often provide representations, warranties and indemnities to cover various risks including unknown damage to the assets, environmental risks involved in the sale of real estate, liability to investigate and remediate environmental contamination at waste disposal sites and manufacturing facilities and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not have the ability to reasonably estimate the potential liability due to the inchoate and unknown nature of these potential liabilities. However, we have no reason to believe that these uncertainties would have a material adverse effect on our financial position, results of operations or cash flows.

In the ordinary course of business, we are required to commit to bonds, letters of credit and bank guarantees that require payments to our customers for any non-performance. The outstanding face value of these instruments fluctuates with the value of our projects in process and in our backlog. In addition, we issue financial stand-by letters of credit primarily to secure our performance to third parties under self-insurance programs.

As of December 31, 2019 and 2018, the outstanding value of bonds, letters of credit and bank guarantees totaled $70.0 million and $75.8 million, respectively.

nVent Electric plc

Notes to consolidated and combined financial statements

Other matters

We are subject to disputes, administrative proceedings and other claims arising out of the normal conduct of our business. These matters generally relate to disputes arising out of the use or installation of our products, product liability litigation, personal injury claims, commercial and contract disputes and employment related matters. On the basis of information currently available, management does not believe that existing proceedings and claims will have a material impact on our Consolidated and Combined Financial Statements. However, litigation is unpredictable, and we could incur judgments or enter into settlements for current or future claims that could adversely affect our financial statements.


17.	Selected Quarterly Data (Unaudited)

The following tables present 2019 and 2018 quarterly financial information:



	2019
In millions, except per-share data	First Quarter		Second Quarter		Third Quarter		Fourth Quarter		Full Year
Net sales	$	538.0	$	539.5	$	559.8	$	566.7	$	2,204.0
Gross profit	209.9		212.2		224.1		219.6		865.8
Operating income	77.5		87.0		86.1		82.5		333.1
Net income	56.4		60.9		59.9		45.5		222.7
Earnings per ordinary share ⁽¹⁾
Basic	$	0.32	$	0.36	$	0.35	$	0.27	$	1.30
Diluted	$	0.32	$	0.35	$	0.35	$	0.27	$	1.29



	2018
In millions, except per-share data	First Quarter		Second Quarter		Third Quarter		Fourth Quarter		Full Year
Net sales	$	538.9	$	542.7	$	563.9	$	568.1	$	2,213.6
Gross profit	208.9		219.4		229.1		218.7		876.1
Operating income	65.6		65.3		93.7		86.2		310.8
Net income	52.3		43.3		68.2		67.0		230.8
Earnings per ordinary share ⁽¹⁾
Basic	$	0.29	$	0.24	$	0.38	$	0.38	$	1.29
Diluted	$	0.29	$	0.24	$	0.38	$	0.37	$	1.28


⁽¹⁾	Amounts may not total to annual earnings because each quarter and year are calculated separately based on basic and diluted weighted-average ordinary shares outstanding during that period. The computations of basic and diluted earnings per share for periods prior to the separation were calculated using the shares that were distributed to Pentair shareholders upon the separation.

Fourth quarter 2019 includes a decrease in net income of $27.3 million related to a "mark-to-market" actuarial loss on pension and other post-retirement plans. First quarter 2018 includes $9.7 million of separation costs and $2.8 million of restructuring and other costs. Second quarter 2018 includes $24.8 million of separation costs and $2.3 million of restructuring and other costs.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the year ended December 31, 2019, pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934 ("the Exchange Act"). Based upon their evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the year ended December 31, 2019 to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms and to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosures.

Management's Annual Report on Internal Control Over Financial Reporting

The report of management required under this ITEM 9A is contained in ITEM 8 of this Annual Report on Form 10-K under the caption "Management's Report on Internal Control Over Financial Reporting."

Attestation Report of Independent Registered Public Accounting Firm

The attestation report required under this ITEM 9A is contained in ITEM 8 of this Annual Report on Form 10-K under the caption "Report of Independent Registered Public Accounting Firm."

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the quarter ended December 31, 2019 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Information required under this item with respect to directors is contained in our Proxy Statement for our 2020 annual general meeting of shareholders under the captions "Proposal 1 Re-elect Director Nominees" and "Corporate Governance Matters," and is incorporated herein by reference.

Information required under this item with respect to executive officers is contained in Part I of this Form 10-K under the caption "Information About Our Executive Officers."

Our Board of Directors has adopted nVent's Code of Business Conduct and Ethics and designated it as the code of ethics for the Company's Chief Executive Officer and senior financial officers. The Code of Business Conduct and Ethics also applies to all employees and directors in accordance with New York Stock Exchange Listing Standards. We have posted a copy of nVent's Code of Business Conduct and Ethics on our website at https://investors.nvent.com/corporate-governance/. We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K regarding amendments to or waivers from, nVent's Code of Business Conduct and Ethics by posting such information on our website at https://investors.nvent.com/corporate-governance/.

We are not including the information contained on our website as part of, or incorporating it by reference into, this report.

ITEM 11. EXECUTIVE COMPENSATION

Information required under this item is contained in our Proxy Statement for our 2020 annual general meeting of shareholders under the captions "Corporate Governance Matters - Director Compensation," "Compensation Committee Report," "Compensation Discussion and Analysis," and "Executive Compensation Tables" and is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information required under this item with respect to security ownership is contained in our Proxy Statement for our 2020 annual general meeting of shareholders under the caption "Security Ownership" and is incorporated herein by reference.

The following table summarizes, as of December 31, 2019, information about compensation plans under which our equity securities are authorized for issuance:



Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)		Weighted-average exercise price of outstanding options, warrants and rights (b)			Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
Equity compensation plans approved by security holders:
2018 Omnibus Incentive Plan	2,528,680	⁽¹⁾	$	27.75	⁽²⁾	3,346,054	⁽³⁾
Total	2,528,680		$	27.75		3,346,054


⁽¹⁾	Consists of 1,766,295 shares subject to stock options, 387,929 shares subject to restricted stock units and 374,456 shares subject to performance share awards.


⁽²⁾	Represents the weighted average exercise price of outstanding stock options and does not take into account outstanding restricted stock units or performance share units.


⁽³⁾	Represents securities remaining available for issuance under the 2018 Omnibus Incentive Plan.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Information required under this item is contained in our Proxy Statement for our 2020 annual general meeting of shareholders under the captions "Proposal 1 Re-elect Director Nominees - Director Independence" and "Corporate Governance Matters - The Board's Role and Responsibilities - Policies and Procedures Regarding Related Person Transactions" and is incorporated herein by reference.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Information required under this item is contained in our Proxy Statement for our 2020 annual general meeting of shareholders under the caption "Proposal 4 Ratify, by Non-Binding Advisory Vote, the Appointment of Deloitte & Touche LLP as the Independent Auditor of nVent Electric plc and to Authorize, by Binding Vote, the Audit and Finance Committee of the Board of Directors to Set the Auditor's Remuneration" and is incorporated herein by reference.

PART IV

ITEM 15. EXHIBITS

The following information required under this item is filed as part of this report:

(1) Financial Statements

Consolidated Financial Statements filed as part of this report are listed under Part II, ITEM 8 of this Form 10-K.

Financial Statement Schedules

None.

All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission have been omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

(2) Exhibits

The exhibits of this Annual Report on Form 10-K included herein are set forth below.



Exhibit Number		Exhibit
2.1		Separation and Distribution Agreement, dated as of April 27, 2018, by and between Pentair plc and nVent Electric plc (incorporated by reference to Exhibit 2.1 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).

2.2		Tax Matters Agreement, dated as of April 27, 2018, by and between Pentair plc and nVent Electric plc (incorporated by reference to Exhibit 2.2 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).

2.3		Transition Services Agreement, dated as of April 27, 2018, by and between Pentair plc and nVent Electric plc (incorporated by reference to Exhibit 2.3 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).

2.4		Employee Matters Agreement, dated as of April 27, 2018, by and between Pentair plc and nVent Electric plc (incorporated by reference to Exhibit 2.4 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).

3.1		Amended and Restated Memorandum and Articles of Association of nVent Electric plc (incorporated by reference to Exhibit 4.1 to Post-Effective Amendment No. 1 to the Registration Statement on Form S-8 of nVent Electric plc filed with the Commission on December 31, 2018 (File No. 333-224555)).

4.1		Indenture, dated as of March 26, 2018, among nVent Finance S.à r.l, nVent Electric plc, Pentair plc, Pentair Investments Switzerland GmbH and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to Amendment No. 4 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on March 26, 2018 (File No. 001-38265)).

4.2		First Supplemental Indenture, dated as of March 26, 2018, among nVent Finance S.à r.l, nVent Electric plc, Pentair plc, Pentair Investments Switzerland GmbH and U.S. Bank National Association (incorporated by reference to Exhibit 4.2 to Amendment No. 4 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on March 26, 2018 (File No. 001-38265)).

4.3		Second Supplemental Indenture, dated as of March 26, 2018, among nVent Finance S.à r.l, nVent Electric plc, Pentair plc, Pentair Investments Switzerland GmbH and U.S. Bank National Association (incorporated by reference to Exhibit 4.3 to Amendment No. 4 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on March 26, 2018 (File No. 001-38265)).

4.4		Third Supplemental Indenture, dated as of April 30, 2018, among nVent Finance S.à r.l, nVent Electric plc and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).

4.5		Credit Agreement, dated as of March 23, 2018, among nVent Electric plc, nVent Finance S.à r.l., Hoffman Schroff Holdings, Inc. (formerly known as Pentair Technical Products Holdings, Inc.) and the lenders and agents party thereto (incorporated by reference to Exhibit 4.4 to Amendment No. 4 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on March 26, 2018 (File No. 001-38265)).



4.6		Amendment No. 1, dated as of December 20, 2019, to Credit Agreement, dated as of March 23, 2018, among nVent Electric plc, nVent Finance S.à r.l., Hoffman Schroff Holdings, Inc. (formerly known as Pentair Technical Products Holdings, Inc) and the lenders and agents party thereto.

4.7		Description of Securities.

10.1		nVent Electric plc 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.2 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).*

10.2		Form of Executive Officer Stock Option Award Agreement (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on May 8, 2018 (File No. 001-38265)).*

10.3		Form of Executive Officer Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 10.3 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on May 8, 2018 (File No. 001-38265)).*

10.4		Form of Executive Officer Performance Stock Unit Award Agreement (incorporated by reference to Exhibit 10.4 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on May 8, 2018 (File No. 001-38265)).*

10.5		nVent Electric plc Management Incentive Plan (incorporated by reference to Exhibit 10.5 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on May 8, 2018 (File No. 001-38265)).*

10.6		Form of Non-Employee Director Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 10.6 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on May 8, 2018 (File No. 001-38265)).*

10.7		Form of Key Executive Employment and Severance Agreement for Beth A. Wozniak, Michael B. Faulconer, Lynnette R. Heath, Jon D. Lammers, Elizabeth C. Noonan, Aravind Padmanabhan, Joseph A. Ruzynski, Randolph A. Wacker, and Sara E. Zawoyski (incorporated by reference to Exhibit 10.6 to Amendment No. 2 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on January 31, 2018 (File No. 001-38265)).*

10.8		nVent Electric plc Employee Stock Purchase and Bonus Plan, as amended and restated January 1, 2019.* (incorporated by reference to Exhibit 10.8 in the Annual Report on Form 10-K of nVent Electric plc filed with the Commission on February 19, 2019 (File No. 001-38265)).*

10.9		nVent Management Company Non-Qualified Deferred Compensation Plan (incorporated by reference to Exhibit 10.4 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).*

10.10		nVent Electric plc Compensation Plan for Non-Employee Directors (incorporated by reference to Exhibit 10.10 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on May 8, 2018 (File No. 001-38265)).*

10.11		nVent Management Company Supplemental Executive Retirement Plan (incorporated by reference to Exhibit 10.5 in the Current Report on Form 8-K of nVent Electric plc filed with the Commission on April 30, 2018 (File No. 001-38265)).*

10.12		Flow Control Supplemental Savings and Retirement Plan (incorporated by reference to Exhibit 10.12 to Amendment No. 2 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on January 31, 2018 (File No. 001-38265)).*

10.13		Form of Deed of Indemnification for directors and executive officers of nVent Electric plc (incorporated by reference to Exhibit 10.4 to Amendment No. 2 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on January 31, 2018 (File No. 001-38265)).*

10.14		Form of Indemnification Agreement for directors and executive officers of nVent Electric plc (incorporated by reference to Exhibit 10.5 to Amendment No. 2 to the Registration Statement on Form 10 of nVent Electric plc filed with the Commission on January 31, 2018 (File No. 001-38265)).*

10.15		Form of Key Executive Employment and Severance Agreement for Robert J. van der Kolk (incorporated by reference to Exhibit 10.15 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on July 26, 2018 (File No. 001-38625)).*

10.16		Separation Agreement and Release, dated October 1, 2019, between Stacy P. McMahan and nVent Management Company (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q of nVent Electric plc filed with the Commission on October 30, 2019 (File No. 001-38625)).*

10.17		Separation Agreement and Release, dated November 7, 2019, between Thomas F. Pettit and nVent Management Company.*




10.18		nVent Electric plc Non-Employee Director Compensation Policy (incorporated by reference to Exhibit 10.17 in the Annual Report on Form 10-K of nVent Electric plc filed with the Commission on February 19, 2019 (File No. 001-38265)).*

10.19		nVent Management Company Severance Plan for Executives effective March 1, 2019, as amended effective December 9, 2019.*

21		List of nVent Electric plc subsidiaries.

23		Consent of Independent Registered Public Accounting Firm — Deloitte & Touche LLP.

24		Power of attorney.

31.1		Certification of Chief Executive Officer.

31.2		Certification of Chief Financial Officer.

32.1		Certification of Chief Executive Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Financial Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following materials from nVent Electric plc's Annual Report on Form 10-K for the year ended December 31, 2019 are filed herewith, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Consolidated and Combined Statements of Operations and Comprehensive Income for the years ended December 31, 2019, 2018 and 2017, (ii) the Consolidated Balance Sheets as of December 31, 2019 and 2018, (iii) the Consolidated and Combined Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017, (iv) the Consolidated and Combined Statements of Changes in Equity for the years ended December 31, 2019, 2018 and 2017 and (v) the Notes to the Consolidated and Combined Financial Statements.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).



*	Denotes a management contract or compensatory plan or arrangement.

ITEM 16. FORM 10-K SUMMARY

None.

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, on February 25, 2020.



	NVENT ELECTRIC PLC

	By	/s/ Sara E. Zawoyski
		Sara E. Zawoyski
		Executive Vice President and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated, on February 25, 2020.



Signature		Title
/s/ Beth A. Wozniak		Chief Executive Officer and Director
Beth A. Wozniak

/s/ Sara E. Zawoyski		Executive Vice President and Chief Financial Officer
Sara E. Zawoyski

/s/ Randolph A. Wacker		Senior Vice President, Chief Accounting Officer and Treasurer
Randolph A. Wacker

*		Director
Brian M. Baldwin

*		Director
Jerry W. Burris

*		Director
Susan M. Cameron

*		Director
Michael L. Ducker

*		Director
David H. Y. Ho

*		Director
Randall J. Hogan

*		Director
Ronald L. Merriman

*		Director
William T. Monahan

*		Director
Herbert K. Parker



*By	/s/ Jon D. Lammers
	Jon D. Lammers
	Attorney-in-fact

Exhibit 4.6 EXECUTION COPY AMENDMENT NO. 1 Dated as of December 20, 2019 to CREDIT AGREEMENT Dated as of March 23, 2018 THIS AMENDMENT NO. 1 (this “Amendment”) is made as of December 20, 2019 by and among nVent Finance S.à r.l., a Luxembourg private limited liability company (Société à responsabilité limitée) having its registered office at 26, Boulevard Royal, L-2449 Luxembourg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and Companies Register (Registre de commerce et des sociétés, Luxembourg) under number B219846 (the “Company”), nVent Electric plc, an Irish public limited company (the “Parent”), and Hoffman Schroff Holdings, Inc. (formerly known as Pentair Technical Products Holdings, Inc.), a Delaware corporation (the “Affiliate Borrower”, collectively with the Company and the Parent, the “Loan Parties”), the Lenders party hereto and JPMorgan Chase Bank, N.A., in its capacity as administrative agent for the Lenders (the “Administrative Agent”), under that certain Credit Agreement dated as of March 23, 2018, by and among the Loan Parties, the Lenders from time to time party thereto and the Administrative Agent (as amended, restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Credit Agreement”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement. WHEREAS, the Loan Parties have requested that the Required Lenders agree to make certain modifications to the Credit Agreement; WHEREAS, the Loan Parties, the Lenders party hereto and the Administrative Agent have agreed to amend the Credit Agreement on the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Loan Parties, the Lenders party hereto and the Administrative Agent hereby agree to enter into this Amendment. 1. Amendments to the Credit Agreement. Effective as of the date of satisfaction of the conditions precedent set forth in Section 2 below (such date, the “Amendment Effective Date”), the parties hereto agree that the Credit Agreement shall be amended to delete the stricken text (indicated textually in the same manner as the following example: stricken text) and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in the pages of the Credit Agreement attached as Annex A hereto (the Credit Agreement as so amended, the “Amended Credit Agreement”). 2. Conditions of Effectiveness. This Amendment shall become effective as of the first date on which each of the following conditions shall have been satisfied: (a) The Administrative Agent (or its counsel) shall have received either US-DOCS\111992278.5

(A) counterparts of this Amendment duly executed by each of the Loan Parties, the Required Lenders and the Administrative Agent or (B) written evidence satisfactory to the Administrative Agent (which may include facsimile or electronic transmission of an executed signature page of this Amendment) that such parties have executed counterparts of this Amendment. (b) (i) The Administrative Agent shall have received, at least five (5) days prior to the Amendment Effective Date, all documentation and other information regarding any Borrower requested in connection with applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act, to the extent requested in writing of the Company at least ten (10) days prior to the Amendment Effective Date and (ii) to the extent any Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, at least five (5) days prior to the Amendment Effective Date, any Lender that has requested, in a written notice to the Company at least ten (10) days prior to the Amendment Effective Date, a Beneficial Ownership Certification in relation to such Borrower shall have received such Beneficial Ownership Certification (provided that, upon the execution and delivery by such Lender of its signature page to this Amendment, the condition set forth in this clause (b) shall be deemed to be satisfied). (c) The Administrative Agent shall have received payment and/or reimbursement of the Administrative Agent’s and its affiliates’ fees and expenses (including the reasonable, documented and invoiced fees, disbursements and other charges of one primary counsel (and one additional local counsel in each applicable jurisdiction) for the Administrative Agent) in accordance with the Loan Documents. The Administrative Agent shall notify the Company and the Lenders of the Amendment Effective Date, and such notice shall be conclusive and binding. 3. Representations and Warranties of the Loan Parties. Each Loan Party hereby represents and warrants as follows: (a) Each of this Amendment and the Amended Credit Agreement constitutes a valid and binding agreement of each Loan Party enforceable against the applicable Loan Parties in accordance with its terms, except to the extent that the enforceability thereof may be limited by the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws now or hereafter affecting creditors’ rights generally, any mandatory applicable provisions of Luxembourg law of general application and general principles of equity. (b) As of the date hereof and immediately after giving effect to the terms of this Amendment, (i) no Default has occurred and is continuing and (ii) the representations and warranties of the Borrowers set forth in the Credit Agreement (other than the representations contained in Sections 3.04(b) and 3.05 of the Credit Agreement) are true and correct in all material respects (provided that any representation or warranty that is qualified by materiality or Material Adverse Effect is true and correct in all respects), or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date. 4. Confirmation of Guarantees. The Parent, by its execution of this Amendment, hereby consents to this Amendment and confirms and ratifies that all of its obligations as a Guarantor under the Amended Credit Agreement shall continue in full force and effect for the benefit of the Administrative Agent and the Lenders with respect to the Amended Credit Agreement and, for the avoidance of doubt, acknowledges and agrees and confirms that the Term Loans made by the Term Lenders to the Company on the Amendment Effective Date are part of the “Guaranteed Obligations” that are guaranteed by the Parent under the Amended Credit Agreement. 2

5. Reference to and Effect on the Credit Agreement. (a) From and after the effectiveness of the amendment to the Credit Agreement evidenced hereby, the terms “Agreement”, “this Agreement”, “herein”, “hereinafter”, “hereto”, “hereof” and words of similar import, as used in the Amended Credit Agreement, shall, unless the context otherwise requires, refer to the Amended Credit Agreement, and the term “Credit Agreement”, as used in the other Loan Documents, shall mean the Amended Credit Agreement. (b) Each Loan Document and all other documents, instruments and agreements executed and/or delivered in connection therewith shall remain in full force and effect and are hereby ratified and confirmed. (c) The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement, the Loan Documents or any other documents, instruments and agreements executed and/or delivered in connection therewith. (d) This Amendment shall be a Loan Document. 6. Governing Law; Jurisdiction. This Amendment shall be construed in accordance with and governed by the law of the State of New York. Each Loan Party hereby irrevocably and unconditionally submits, for itself and its property, to only the jurisdiction of (i) the Supreme Court of the State of New York sitting in New York County, Borough of Manhattan, and of the United States District Court for the Southern District of New York sitting in the Borough of Manhattan and (ii) any U.S. federal or Illinois state court sitting in Chicago, Illinois, and in each case any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Amendment or any other Loan Document shall affect any right that the Administrative Agent, any Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Amendment or any other Loan Document against any Loan Party or its properties in the courts of any jurisdiction. 7. Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose. 8. Counterparts. This Amendment may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Amendment by telecopy, e-mailed .pdf or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart of this Amendment. [Signature Pages Follow] 3

ANNEX A Attached

EXECUTION�COP� CREDIT�AGREEMENT dated�as�of March�23,�2018 among NVENT�ELECTRIC�plc as�Parent, NVENT�FINANCE�S.��R.L. as�Company, PENTAIR�TECHNICAL�PRODUCTSHOFFMAN�SCHROFF�HOLDINGS,�INC. as�an�Affiliate�Borrower The�Other�Affiliate�Borrowers�From�Time�to�Time�Party�Hereto, The�Lenders�Party�Hereto, JPMORGAN�CHASE�BANK,�N.A. as�Administrative�Agent, BANK�OF�AMERICA,�N.A. THEMUFG�BANK�OF�TOK�O-MITSUBISHI�UFJ,�LTD. CITIBANK,�N.A.�and U.S.�BANK�NATIONAL�ASSOCIATION as�Syndication�Agents, and GOLDMAN�SACHS�BANK�USA WELLS�FARGO�BANK,�NATIONAL�ASSOCIATION HSBC�BANK�USA,�NATIONAL�ASSOCIATION�and DEUTSCHE�BANK�SECURITIES�INC. as�Documentation�Agents JPMORGAN�CHASE�BANK,�N.A. MERRILL�L�NCH,�PIERCE,�FENNER��SMITH�INCORPORATED THEMUFG�BANK�OF�TOK�O-MITSUBISHI�UFJ,�LTD. CITIGROUP�GLOBAL�MARKETS�INC.�and U.S.�BANK�NATIONAL�ASSOCIATION US-DOCS\111991625.1111991625.6

TABLE�OF�CONTENTS Page ARTICLE�I.�DEFINITIONS 5 SECTION�1.01 Defined�Terms 5 SECTION�1.02 Classification�of�Loans�and�Borrowings 3637 SECTION�1.03 Terms�Generally 3637 SECTION�1.04 Accounting�Terms��GAAP 3637 SECTION�1.05 Interest�Rates 3738 SECTION�1.06 Luxembourg�Terms 3738 SECTION�1.07 Certain�Calculations 3738 SECTION�1.08 Divisions 39 ARTICLE�II.�THE�CREDITS 3839 SECTION�2.01 Commitments 3839 SECTION�2.02 Loans�and�Borrowings 3839 SECTION�2.03 Requests�for�Borrowings 3940 SECTION�2.04 Determination�of�Dollar�Amounts 3941 SECTION�2.05 Swingline�Loans 4041 SECTION�2.06 Letters�of�Credit 4143 SECTION�2.07 Funding�of�Borrowings 4748 SECTION�2.08 Interest�Elections 4849 SECTION�2.09 Termination�and�Reduction�of�Commitments 4950 SECTION�2.10 Repayment�and�Amorti�ation�of�Loans��Evidence�of�Indebtedness 5051 SECTION�2.11 Prepayment�of�Loans 5152 SECTION�2.12 Fees �5253 SECTION�2.13 Interest 5354 SECTION�2.14 Alternate�Rate�of�Interest 5556 SECTION�2.15 Increased�Costs 5657 SECTION�2.16 Break�Funding�Payments 5859 SECTION�2.17 Taxes �5859 SECTION�2.18 Payments�Generally��Pro�Rata�Treatment��Sharing�of�Set-offs 6566 SECTION�2.19 Mitigation�Obligations��Replacement�of�Lenders 6768 SECTION�2.20 Expansion�Option 6869 SECTION�2.21 Market�Disruption 6970 SECTION�2.22 Judgment�Currency 7071 SECTION�2.23 Designation�of�Affiliate�Borrowers 7071 SECTION�2.24 Defaulting�Lenders 7072 SECTION�2.25 Extension�of�Maturity�Date. 7274 ARTICLE�III.�REPRESENTATIONS�AND�WARRANTIES 7576 SECTION�3.01 Corporate�Existence�and�Power. 7576 SECTION�3.02 Corporate�and�Governmental�Authori�ation��Contravention. 7576 SECTION�3.03 Binding�Effect. 7576 SECTION�3.04 Financial�Information 7576 SECTION�3.05 Litigation,�etc. 7677 SECTION�3.06 ERISA�Compliance. 7677 SECTION�3.07 Taxes. 7677 SECTION�3.08 Not�an�Investment�Company. 7677

SECTION�3.09 Environmental�Matters 7677 SECTION�3.10 Use�of�Proceeds. 7677 SECTION�3.11 Disclosure. 7677 SECTION�3.12 Anti-Corruption�Laws�and�Sanctions. 7778 SECTION�3.13 Domiciliation��Centre�of�Main�Interests 7778 SECTION�3.14 Swiss�Non-Bank�Rules 78 SECTION�3.15 EEA�Financial�Institutions 7879 SECTION�3.16 Irish�Loan�Party 7879 SECTION�3.17 Tax�Residence 7879 ARTICLE�IV.�CONDITIONS 7879 SECTION�4.01 Effective�Date 7879 SECTION�4.02 Closing�Date 7980 SECTION�4.03 Each�Credit�Event 8081 SECTION�4.04 Designation�of�an�Affiliate�Borrower 8182 ARTICLE�V.�AFFIRMATIVE�COVENANTS 8283 SECTION�5.01 Information. 8283 SECTION�5.02 Use�of�Proceeds 8485 SECTION�5.03 Compliance�with�Contractual�Obligations�and�Laws 8485 SECTION�5.04 Insurance. 8485 SECTION�5.05 Ownership�of�Borrowers. 8485 SECTION�5.06 Payment�of�Taxes 8485 SECTION�5.07 Swiss�Non-Bank�Rule 8586 SECTION�5.08 Loan�Party�Location 8586 SECTION�5.09 Tax�Residence 8586 SECTION�5.10 Service�of�Process�Agent 8586 ARTICLE�VI.�NEGATIVE�COVENANTS 8586 SECTION�6.01 Maximum�Net�Leverage�Ratio 8586 SECTION�6.02 Minimum�Interest�Coverage�Ratio 8687 SECTION�6.03 Negative�Pledge. 8687 SECTION�6.04 Consolidations,�Mergers�and�Sales�of�Assets��Acquisitions. 8889 SECTION�6.05 Subsidiary�Debt. 8889 SECTION�6.06 OFAC�and�Anti-Corruption�Laws 8990 ARTICLE�VII.�EVENTS�OF�DEFAULT 9091 ARTICLE�VIII.�THE�ADMINISTRATIVE�AGENT 9394 SECTION�8.01 Authori�ation�and�Action 9394 SECTION�8.02 Administrative�Agent�s�Reliance,�Indemnification,�Etc 9596 SECTION�8.03 Posting�of�Communications. 9697 SECTION�8.04 The�Administrative�Agent�Individually 9798 SECTION�8.05 Successor�Administrative�Agent 9798 SECTION�8.06 Acknowledgement�of�Lenders�and�Issuing�Banks. 9899 SECTION�8.07 Certain�ERISA�Matters 9899 ARTICLE�IX.�MISCELLANEOUS 100101 SECTION�9.01 Notices 100101 SECTION�9.02 Waivers��Amendments 102103 SECTION�9.03 Expenses��Indemnity��Damage�Waiver 104105

SECTION�9.04 Successors�and�Assigns 105106 SECTION�9.05 Survival 110111 SECTION�9.06 Counterparts��Integration��Effectiveness��Electronic�Execution 110111 SECTION�9.07 Severability 111112 SECTION�9.08 Right�of�Setoff 111112 SECTION�9.09 Governing�Law��Jurisdiction��Consent�to�Service�of�Process 111112 SECTION�9.10 WAIVER�OF�JUR��TRIAL 112113 SECTION�9.11 Headings 113114 SECTION�9.12 Confidentiality 113114 SECTION�9.13 USA�PATRIOT�Act 114115 SECTION�9.14 Interest�Rate�Limitation 114115 SECTION�9.15 No�Fiduciary�Duty,�etc 114115 SECTION�9.16 Acknowledgement�and�Consent�to�Bail-In�of�EEA�Financial�Institutions115116 SECTION�9.17 Confirmation�of�Lender�s�Status�as�Swiss�Qualifying�Lender 116 SECTION�9.18 Acknowledgement�Regarding�Supported�QFCs 117 ARTICLE�X.�PARENT�GUARANTEE 116117 SCHEDULES: Schedule�2.01 -- Commitments Schedule�2.05� -- Swingline�Sublimits Schedule�6.03 -- List�of�Existing�Liens Schedule�6.05 -- Existing�Debt EXHIBITS: Exhibit�A� -- Form�of�Assignment�and�Assumption Exhibit�B-1 -- Form�of�Opinion�of�Foley��Lardner�LLP Exhibit�B-2 -- Form�of�Opinion�of�Arthur�Cox Exhibit�B-3��-- Form�of�Opinion�of�Allen��Overy Exhibit�C-1� -- Form�of�Increasing�Lender�Supplement Exhibit�C-2��-- Form�of�Augmenting�Lender�Supplement Exhibit�D-1 -- Form�of�Revolving�Credit�Note Exhibit�D-2 -- Form�of�Term�Loan�Note Exhibit�E� --� List�of�Effective�Date�and�Closing�Date�Documents Exhibit�F-1� -- Form�of�Affiliate�Borrowing�Agreement Exhibit�F-2� -- Form�of�Affiliate�Borrowing�Termination Exhibit�G-1 -- Form�of�Borrowing�Request Exhibit�G-2 -- Form�of�Interest�Election�Request Exhibits�H-1-4 -- Form�of�U.S.�Tax�Compliance�Certificates Exhibit�I -- Form�of�Irish�Qualifying�Lender�Confirmation

CREDIT� AGREEMENT� (this� “Agreement�� dated� as� of� March� 23,� 2018� among� NVENT ELECTRIC�plc,�an�Irish�public�limited�company,�NVENT�FINANCE�S.��R.L.,�a�Luxembourg�private limited�liability�company�(Société à responsabilité limitée��having�its�registered�office�at�26,�boulevard Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg�Trade�and�Companies�Register�under number�B219846,�the�other�AFFILIATE�BORROWERS�from�time�to�time�party�hereto,�the�LENDERS from�time�to�time�party�hereto,�JPMORGAN�CHASE�BANK,�N.A.,�as�Administrative�Agent,�BANK�OF AMERICA,� N.A.,� THEMUFG� BANK� OF� TOK�O-MITSUBISHI� UFJ,� LTD.� (f/k/a� The� Bank� of Tokyo-Mitsubishi� UFJ,� Ltd.�,� CITIBANK,� N.A.� and� U.S.� BANK� NATIONAL� ASSOCIATION,� as Syndication� Agents� and� GOLDMAN� SACHS� BANK� USA,� � WELLS� FARGO� BANK,� NATIONAL ASSOCIATION,� HSBC� BANK� USA,� NATIONAL� ASSOCIATION� and� DEUTSCHE� BANK SECURITIES�INC.,�as�Documentation�Agents. NOW,� THEREFORE,� in� consideration� of� the� premises� and� the� mutual� covenants� contained herein,�the�parties�hereto�agree�as�follows: ARTICLE�I. DEFINITIONS SECTION�1.01 � Defined� Terms.� � As� used� in� this� Agreement,� the� following� terms� have� the meanings�specified�below: “ABR�,�when�used� in�reference�to�any�Loan�or�Borrowing,�refers�to�such�Loan,�or�the�Loans comprising�such�Borrowing,�bearing�interest�at�a�rate�determined�by�reference�to�the�Alternate�Base�Rate. “Acquisition��means�any�transaction�or�series�of�related�transactions�(excluding�any�transaction solely�among�the�Parent�and/or�one�or�more�persons�that�are�already�Subsidiaries��that�result,�directly�or indirectly,�in�(a��the�acquisition�by�the�Parent�or�any�Subsidiary�of�all�or�substantially�all�of�the�assets�of�a Person,�or�of�all�or�substantially�all�of�any�business�or�division�of�a�Person,�(b��the�acquisition�of�in�excess of� 50%� of� the� capital� stock,� partnership� interests,� membership� interests� or� equity� of� any� Person,� or otherwise� causing� any� Person� to� become� a� Subsidiary,� or� (c�� a� merger� or� consolidation� or� any� other combination�with�another�Person��provided�that�the�Parent�or�a�Subsidiary�is�the�ultimate�surviving�entity. “Additional�Commitment�Lender��has�the�meaning�assigned�to�such�term�in�Section�2.25(d�. “Adjusted� LIBO� Rate�� means,� with� respect� to� any� Eurocurrency� Borrowing� for� any� Interest Period,�an�interest�rate�per�annum�equal�to�(a��the�LIBO�Rate�for�such�Interest�Period�multiplied�by�(b��the Statutory�Reserve�Rate. “Administrative�Agent��means�JPMCB�(including�its�branches�and�affiliates��in�its�capacity�as administrative� agent� for� the� Lenders� hereunder,� and� any� successor� administrative� agent� arising� under Section�9.04. “Administrative�Questionnaire��means�an�Administrative�Questionnaire�in�a�form�supplied�by�the Administrative�Agent. “Affiliate��means,�as�to�any�Person,�any�other�Person�directly�or�indirectly�controlling,�controlled by,� or� under� direct� or� indirect� common� control� with,� such� Person.� � A� Person� shall� be� deemed� to� be “controlled�by��any�other�Person�if�such�other�Person�possesses,�directly�or�indirectly,�power�to�direct�or cause�the�direction�of�the�management�and�policies�of�such�Person�whether�by�contract�or�otherwise�(but,

for�the�avoidance�of�doubt,�no�individual�shall�be�deemed�to�be�an�Affiliate�of�a�Person�solely�because such�individual�is�a�director�(or�the�equivalent�thereof��or�senior�officer�of�such�Person�. “Affiliate�Borrower�Sublimit��means�$300,000,000. “Affiliate� Borrowers�� means,� collectively,� the� Initial� Affiliate� Borrower� and� any� Eligible Subsidiary�that�becomes�an�Affiliate�Borrower�pursuant�to�Section�2.23�and,�in�each�case,�that�has�not ceased�to�be�an�Affiliate�Borrower��and�“Affiliate�Borrower��means�any�of�the�Affiliate�Borrowers. “Affiliate�Borrowing�Agreement��means�an�Affiliate�Borrowing�Agreement�substantially�in�the form�of�Exhibit�F-1. “Affiliate�Borrowing�Termination��means�an�Affiliate�Borrowing�Termination�substantially�in�the form�of�Exhibit�F-2. “Agent�Indemnitee��has�the�meaning�assigned�to�it�in�Section�9.03(c�. “Agreed�Currencies��means�with�respect�to�(a��Revolving�Loans,�Agreed�Loan�Currencies�and (b��Letters�of�Credit,�Agreed�LC�Currencies. “Agreed�LC�Currencies��means�(a��the�Agreed�Loan�Currencies�and�(b��any�other�currency�that�is (i�� readily� available� and� freely� transferable� and� convertible� into� Dollars� and� (ii�� agreed� to� by� the Company,�the�Administrative�Agent�and�the�relevant�Issuing�Bank. “Agreed�Loan�Currencies��means�(i��Dollars,�(ii��euro,�(iii��Pounds�Sterling�and�(iv��any�other currency�(A��that�is�a�lawful�currency�(other�than�Dollars��that�is�readily�available�and�freely�transferable and� convertible� into� Dollars,� (B�� for� which� a� LIBOR� Screen� Rate� is� available� in� the� Administrative Agent�s�reasonable�determination�and�(C��that�is�agreed�to�by�the�Administrative�Agent�and�each�of�the Revolving�Lenders. “Agreement��means�this�Credit�Agreement. “Alternate�Base�Rate��means,�for�any�day,�a�rate�per�annum�equal�to�the�greatest�of�(a��the�Prime Rate�in�effect�on�such�day,�(b��the�N�FRB�Rate�in�effect�on�such�day�plus��of�1%�and�(c��the�Adjusted LIBO�Rate�for�a�one�month�Interest�Period�in�Dollars�on�such�day�(or�if�such�day�is�not�a�Business�Day, the�immediately�preceding�Business�Day��plus�1%,�provided�that�for�the�purpose�of�this�definition,�the Adjusted�LIBO�Rate�for�any�day�shall�be�based�on�the�LIBO�Rate�(or�if�the�LIBO�Rate�is�not�available�for such�one�month�Interest�Period,�the�Interpolated�Rate��at�approximately�11:00�a.m.�London�time�on�such day.��Any�change�in�the�Alternate�Base�Rate�due�to�a�change�in�the�Prime�Rate,�the�N�FRB�Rate�or�the Adjusted�LIBO�Rate�shall�be�effective�from�and�including�the�effective�date�of�such�change�in�the�Prime Rate,�the�N�FRB�Rate�or�the�Adjusted�LIBO�Rate,�respectively.��If�the�Alternate�Base�Rate�is�being�used as�an�alternate�rate�of�interest�pursuant�to�Section�2.14�hereof,�then�the�Alternate�Base�Rate�shall�be�the greater�of�clause�(a��and�(b��above�and�shall�be�determined�without�reference�to�clause�(c��above.��For�the avoidance�of�doubt,�if�the�Alternate�Base�Rate�as�so�determined�would�be�less�than��ero,�such�rate�shall�be deemed�to�be��ero�for�purposes�of�this�Agreement. “Alternative�Rate��has�the�meaning�assigned�to�such�term�in�Section�2.14(a�. “Amendment�No.�1�Effective�Date��means�December�20,�2019. 7

“Anti-Corruption�Laws��means�all�laws,�rules,�and�regulations�of�any�jurisdiction�applicable�to the�Parent�and�its�affiliated�companies�concerning�or�relating�to�bribery�or�corruption. “Applicable�LC�Sublimit��means�(i��with�respect�to�JPMCB�in�its�capacity�as�an�Issuing�Bank under� this� Agreement,� $40,000,000,� (ii�� with� respect� to� Bank� of� America,� N.A.� in� its� capacity� as� an Issuing� Bank� under� this� Agreement,� $40,000,000,� (iii�� with� respect� to� TheMUFG� Bank� of� Tokyo- Mitsubishi�UFJ,�Ltd.�in�its�capacity�as�an�Issuing�Bank�under�this�Agreement,�$40,000,000,�(iv��with respect�to�Citibank,�N.A.�in�its�capacity�as�an�Issuing�Bank�under�this�Agreement,�$40,000,000,�(v��with respect� to� U.S.� Bank� National� Association� in� its� capacity� as� an� Issuing� Bank� under� this� Agreement, $40,000,000�and�(vi��with�respect�to�any�other�Person�that�becomes�an�Issuing�Bank�pursuant�to�the�terms of�this�Agreement,�such�amount�as�agreed�to�in�writing�by�the�Company,�the�Administrative�Agent�and such�Person�at�the�time�such�Person�becomes�an�Issuing�Bank�pursuant�to�the�terms�of�the�Agreement,�as each�of�the�foregoing�amounts�may�be�decreased�or�increased�from�time�to�time�with�the�written�consent of� the� Company,� the� Administrative� Agent� and� the� Issuing� Banks� (provided� that� any� increase� in� the Applicable�LC�Sublimit�with�respect�to�any�Issuing�Bank�shall�only�require�the�consent�of�the�Company and�such�Issuing�Bank�. “Applicable�Maturity�Date��has�the�meaning�assigned�to�such�term�in�Section�2.25(a�. “Applicable�Percentage��means,�with�respect�to�any�Lender,�(a��with�respect�to�Revolving�Loans, Revolving� Credit� Exposure,� LC� Exposure� or� Swingline� Loans,� the� percentage� equal� to� a� fraction� the numerator� of� which� is� such� Lender�s� Revolving� Commitment� and� the� denominator� of� which� is� the aggregate� Revolving� Commitments� of� all� Revolving� Lenders� (if� the� Revolving� Commitments� have terminated� or� expired,� the� Applicable� Percentages� shall� be� determined� based� upon� the� Revolving Commitments�most�recently�in�effect,�giving�effect�to�any�assignments��and�(b��with�respect�to�the�Term Loans,�(i��at�any�time�prior�to�advancing�the�Term�Loans,�a�percentage�equal�to�a�fraction�the�numerator of�which�is�such�Lender�s�Term�Loan�Commitment�and�the�denominator�of�which�is�the�aggregate�Term Loan� Commitments� of� all� Term� Lenders� and� (ii�� at� any� time� after� advancing� the� Term� Loans,� a percentage�equal�to�a�fraction�the�numerator�of�which�is�such�Lender�s�outstanding�principal�amount�of the�Term�Loans�and�the�denominator�of�which�is�the�aggregate�outstanding�principal�amount�of�the�Term Loans�of�all�Term�Lenders��provided�that,�in�the�case�of�each�of�the�foregoing�clauses�(a��and�(b�,�in�the case� of� Section�2.24� when� a� Defaulting� Lender� shall� exist,� any� such� Defaulting� Lender�s� Revolving Commitment,� Dollar� and/or� Term� Loan� Commitment,� as� applicable,� shall� be� disregarded� in� the calculation. “Applicable�Rate��means,�for�any�day,�with�respect�to�any�Eurocurrency�Revolving�Loan,�any Eurocurrency� Term� Loan,� any� ABR� Revolving� Loan,� or� any� ABR� Term�Loan,� or� with� respect� to� the facility�fees�payable�hereunder,�as�the�case�may�be,�the�applicable�rate�per�annum�set�forth�below�under the�caption�“Eurocurrency�Spread�for�Revolving�Loans�,�“Eurocurrency�Spread�for�Term�Loans�,�“ABR Spread�for�Revolving�Loans�,��“ABR�Spread�for�Term�Loans��or�“Facility�Fee�Rate�,�as�the�case�may�be, based�upon�the�Pricing�Level�applicable�on�such�date. Pricing Facility Eurocurrency ABR Eurocurrency ABR Level Fee Spread�for Spread�for Spread�for Spread�for Revolving�Loans Revolving�Loans Term�Loans Term�Loans Level�I 0.10% 0.90% 0% 1.00% 0% Level�II 0.125% 1.00% 0% 1.125% 0.125% Level�III 0.15% 1.10% 0.10% 1.25% 0.25% 8

“Approved� Jurisdictions�� means� Ireland,� Swit�erland,� Luxembourg,� the� United� States� and England�and�Wales. “Arrangers��means�each�of�JPMCB,�Merrill�Lynch,�Pierce,�Fenner��Smith�Incorporated,�MUFG Bank,�Ltd.�(f/k/a�The�Bank�of�Tokyo-Mitsubishi�UFJ,�Ltd.�,�Citigroup�Global�Markets�Inc.�and�U.S. Bank�National�Association�in�its�capacity�as�a�joint�bookrunner�and�joint�lead�arranger�hereunder. “Assignment�and�Assumption��means�an�assignment�and�assumption�agreement�entered�into�by�a Lender�and�an�assignee�(with�the�consent�of�any�party�whose�consent�is�required�by�Section�9.04�,�and accepted� by� the� Administrative� Agent,� in� the� form� of� Exhibit� A� or� any� other� form� approved� by� the Administrative�Agent. “Augmenting�Lender��is�defined�in�Section�2.20. “Availability�Period��means�the�period�from�and�including�the�Closing�Date�to�but�excluding�the earlier�of�the�Revolving�Credit�Maturity�Date�and�the�date�of�termination�of�the�Revolving�Commitments. “Bail-In� Action�� means� the� exercise� of� any� Write-Down� and� Conversion� Powers� by� the applicable�EEA�Resolution�Authority�in�respect�of�any�liability�of�an�EEA�Financial�Institution. “Bail-In�Legislation��means,�with�respect�to�any�EEA�Member�Country�implementing�Article�55 of� Directive� 2014/59/EU� of� the� European� Parliament� and� of� the� Council� of� the� European� Union,� the implementing�law�for�such�EEA�Member�Country�from�time�to�time�which�is�described�in�the�EU�Bail-In Legislation�Schedule. “Banking�Services��means�each�and�any�of�the�following�bank�services�provided�to�the�Parent�or any� Subsidiary� by� any� Lender� or� any� of� its� Affiliates:� � (a�� credit� cards� for� commercial� customers (including,�without�limitation,�commercial�credit�cards�and�purchasing�cards�,�(b��stored�value�cards,�(c� merchant� processing� services� and� (d�� treasury� management� services� (including,� without� limitation, controlled�disbursement�services,�automated�clearinghouse�transactions,�return�items�services,�any�direct debit�scheme�or�arrangement,�overdraft�services�and�interstate�depository�network�services�. “Banking� Services� Agreement�� means� any� agreement� entered� into� by� the� Parent� or� any Subsidiary�in�connection�with�Banking�Services. “Bankruptcy�Event��means,�with�respect�to�any�Person,�such�Person�becomes�the�subject�of�a voluntary�or�involuntary�bankruptcy�or�insolvency�proceeding,�or�has�had�a�receiver,�conservator,�trustee, administrator,� custodian,� assignee� for� the� benefit� of� creditors� or� similar� Person� charged� with� the reorgani�ation�or�liquidation�of�its�business�appointed�for�it,�or,�in�the�good�faith�determination�of�the Administrative�Agent,�has�taken�any�action�in�furtherance�of,�or�indicating�its�consent�to,�approval�of,�or acquiescence�in,�any�such�proceeding�or�appointment�or�has�had�any�order�for�relief�in�such�proceeding entered� in� respect� thereof,� provided� that� a� Bankruptcy� Event� shall� not� result� solely� by� virtue� of� any ownership� interest,� or� the� acquisition� of� any� ownership� interest,� in� such� Person� by� a� Governmental Authority�or�instrumentality�thereof,�unless�such�ownership�interest�results�in�or�provides�such�Person with� immunity� from� the� jurisdiction� of� courts� within� the� United� States� or� from� the� enforcement� of judgments�or�writs�of�attachment�on�its�assets�or�permits�such�Person�(or�such�Governmental�Authority�or instrumentality�� to� reject,� repudiate,� disavow� or� disaffirm� any� contracts� or� agreements� made� by� such Person. 11

“Beneficial�Ownership�Certification��means�a�certification�regarding�beneficial�ownership or�control�as�required�by�the�Beneficial�Ownership�Regulation. “Beneficial�Ownership�Regulation��means�31�C.F.R.��1010.230. “Benefit� Plan�� means� any� of� (a�� an� “employee� benefit� plan�� (as� defined� in� Section� 3(3�� of ERISA��that�is�subject�to�Title�I�of�ERISA,�(b��a�“plan��as�defined�in�Section�4975�of�the�Code�to�which Section�4975�of�the�Code�applies,�and�(c��any�Person�whose�assets�include�(for�purposes�of�the�Plan�Asset Regulations�or�otherwise�for�purposes�of�Title�I�of�ERISA�or�Section�4975�of�the�Code��the�assets�of�any such�“employee�benefit�plan��or�“plan�. “BHC�Act�Affiliate��of�a�party�means�an�“affiliate��(as�such�term�is�defined�under,�and interpreted�in�accordance�with,�12�U.S.C.�1841(k��of�such�party. “Board��means�the�Board�of�Governors�of�the�Federal�Reserve�System�of�the�United�States. “Borrower��means�the�Company�or�any�Affiliate�Borrower. “Borrowing��means�(a��Revolving�Loans�of�the�same�Type,�made,�converted�or�continued�on�the same�date�and,�in�the�case�of�Eurocurrency�Loans,�as�to�which�a�single�Interest�Period�is�in�effect,�(b��a Term�Loan�of�the�same�Type�and�Class,�made,�converted�or�continued�on�the�same�date�and,�in�the�case of�Eurocurrency�Loans,�as�to�which�a�single�Interest�Period�is�in�effect�or�(c��a�Swingline�Loan. “Borrowing� Request�� means� a� request� by� any� Borrower� for� a� Borrowing� in� accordance� with Section� 2.03� in� substantially� the� form� attached� hereto� as� Exhibit� G-1� or� such� other� form� as� the Administrative�Agent�may�approve�from�time�to�time. “Business�Day��means�any�day�that�is�not�a�Saturday,�Sunday�or�other�day�on�which�commercial banks�in�New��ork�City�are�authori�ed�or�required�by�law�to�remain�closed��provided�that,�when�used�in connection� with� a� Eurocurrency� Loan,� the� term� “Business� Day�� shall� also� exclude� any� day� on� which banks�are�not�open�for�dealings�in�the�relevant�Agreed�Currency�in�the�London�interbank�market�or�the principal�financial�center�of�such�Agreed�Currency�(and,�if�the�Borrowings�or�LC�Disbursements�which are�the�subject�of�a�borrowing,�drawing,�payment,�reimbursement�or�rate�selection�are�denominated�in euro,�the�term�“Business�Day��shall�also�exclude�any�day�on�which�the�TARGET2�payment�system�is�not open�for�the�settlement�of�payments�in�euro�. “Calendar�Quarter��means�each�of�the�four�calendar�quarters�of�each�calendar�year�ending�each March�31,�June�30,�September�30�and�December�31�of�each�calendar�year. “Cash�Collaterali�e��means�to�pledge�and�deposit�with�or�deliver�to�the�Administrative�Agent,�for the� benefit� of� the� Administrative� Agent,� the� applicable� Issuing� Bank� and� the� Revolving� Lenders,� as collateral�or�support�for�the�LC�Exposure,�cash�or�deposit�account�balances,�or�a�standby�letter�of�credit from� a� financial� institution� satisfactory� to� the� Administrative� Agent,� in� each� case� pursuant� to documentation� in� form� and� substance� reasonably� satisfactory� to� the� Administrative� Agent� and� the applicable�Issuing�Bank�(which�documents�are�hereby�consented�to�by�the�Lenders�.��Derivatives�of�such term�shall�have�corresponding�meanings. “Change�in�Law��means�the�occurrence,�after�the�Effective�Date�(or�with�respect�to�any�Lender,�if later,�the�date�on�which�such�Lender�becomes�a�Lender�,�of�any�of�the�following:��(a��the�adoption�or taking�effect�of�any�law,�rule,�regulation�or�treaty,�(b��any�change�in�any�law,�rule,�regulation�or�treaty�or in� the� administration,� interpretation,� implementation� or� application� thereof� by� any� Governmental 12

“Consolidated�Subsidiary��means,�as�of�any�date,�any�Subsidiary�or�other�entity�the�accounts�of which�would�be�consolidated�with�those�of�the�Parent�in�its�consolidated�financial�statements�as�of�such date�prepared�in�accordance�with�GAAP. “Consolidated�Total�Assets��means�the�total�consolidated�assets�of�the�Parent�and�its�Subsidiaries, in�each�case�determined�in�accordance�with�GAAP. “Country�Risk�Event��means: (a� any�law,�action�or�failure�to�act�by�any�Governmental�Authority�in�any�Borrower�s�or Letter�of�Credit�beneficiary�s�country�which�has�the�effect�of: (i� changing�the�obligations�of�any�Issuing�Bank�or�the�Lenders�under�the relevant� Letter� of� Credit,� the� Agreement� or� any� of� the� other� Loan� Documents� as originally� agreed� or� otherwise� creating�any�additional�liability,�cost�or� expense�to� any Issuing� Bank,� the� Lenders� or� the� Administrative� Agent� from� that� which� exists� on� the Effective�Date, (ii� changing�the�ownership�or�control�by�such�Borrower�or�Letter�of�Credit beneficiary�of�its�business,�or (iii� preventing�or�restricting�the�conversion�into�or�transfer�of�the�applicable Agreed�Currency� (b� force�majeure��or (c� any�similar�event, which,�in�relation�to�(a�,�(b��and�(c�,�directly�or�indirectly,�prevents�or�restricts�the�payment�or�transfer�of any�amounts�owing�under�the�relevant�Letter�of�Credit�in�the�applicable�Agreed�Currency�into�an�account designated�by�the�Administrative�Agent�or�such�Issuing�Bank�and�freely�available�to�the�Administrative Agent�or�such�Issuing�Bank. “Covered�Entity��means�any�of�the�following: (i�� a� “covered� entity�� as� that� term� is� defined� in,� and� interpreted� in accordance�with,�12�C.F.R.��252.82(b�� (ii�� a� “covered� bank�� as� that� term� is� defined� in,� and� interpreted� in accordance�with,�12�C.F.R.��47.3(b��or (iii�� a� “covered� FSI�� as� that� term� is� defined� in,� and� interpreted� in accordance�with,�12�C.F.R.��382.2(b�. “Covered�Party��has�the�meaning�assigned�to�it�in�Section�9.18. “Credit�Event��means�a�Borrowing,�the�issuance,�renewal�or�extension�of�a�Letter�of�Credit,�the amendment�of�a�Letter�of�Credit�that�increases�the�face�amount�thereof,�an�LC�Disbursement�or�any�of�the foregoing. 14

“Credit�Exposure��means,�as�to�any�Lender�at�any�time,�the�sum�of�(a��such�Lender�s�Revolving Credit�Exposure�at�such�time,�plus�(b��an�amount�equal�to�the�aggregate�principal�amount�of�its�Term Loans�outstanding�at�such�time. “Credit�Party��means�the�Administrative�Agent,�the�Issuing�Banks,�the�Swingline�Lenders�or�any other�Lender. “Debt��means,�with�respect�to�any�Person�at�any�date,�without�duplication,�(i��all�obligations�of such� Person� for� borrowed� money,� (ii�� all� obligations� of� such� Person� evidenced� by� bonds,� debentures, notes�or�other�similar�instruments,�(iii��all�obligations�of�such�Person�to�pay�the�deferred�purchase�price�of property� or� services,� except� trade� accounts� payable� and� accrued� liabilities� (including� employee compensation� and� benefit� obligations�� arising� in� the� ordinary� course� of� business,� (iv�� the� outstanding principal�obligations�of�such�Person�as�lessee�under�capital�leases,�(v��all�Debt�of�others�secured�by�a�Lien on�any�asset�of�such�Person,�whether�or�not�such�Debt�is�assumed�by�such�Person�(it�being�understood that�if�such�Debt�has�not�been�assumed�by�such�Person,�the�amount�of�such�Debt�shall�be�deemed�to�be the� lesser� of� the� fair� market� value� at� such� date� of� such� asset� and� the� amount� of� such� Debt�,� (vi�� the aggregate�outstanding�investment�or�claim�held�by�purchasers,�assignees�or�transferees�of�(or�of�interests in��receivables�of�such�Person�in�connection�with�any�Securiti�ation�Transaction,�(vii��all�non-contingent reimbursement�obligations�of�such�Person�under�letters�of�credit�and�bank�guarantees,�and�(viii��all�Debt (as� defined� above�� of� others� Guaranteed� by� such� Person.� � Notwithstanding� the� foregoing,� Debt� shall exclude�(a��any�“earnouts��or�similar�obligations�accrued�in�respect�of�any�Permitted�Acquisition,�(b��any obligations� in� respect� of� customer� advances� in� the� ordinary� course� of� business� consistent� with� past practices� and� (c��defeased� and/or� discharged� indebtedness� so� long� as� (i�� neither� the� Parent� nor� any Subsidiary�has�any�liability�(contingent�or�otherwise��with�respect�to�such�indebtedness�and�(ii��the�cash, securities� and/or� other� assets� used� to� defease� and/or� discharge� such� indebtedness� are� not,� directly� or indirectly,�an�asset�of�the�Parent�or�any�Subsidiary.��In�the�event�any�of�the�foregoing�Debt�is�limited�to recourse�against�a�particular�asset�or�assets�of�such�Person,�the�amount�of�the�corresponding�Debt�shall�be equal�to�the�lesser�of�the�amount�of�such�Debt�and�the�fair�market�value�of�such�asset�or�assets�at�the�date for�determination�of�the�amount�of�such�Debt.��For�the�avoidance�of�doubt,�the�amount�of�Debt�of�any Person�at�any�date�will�be�calculated�without�duplication�of�any�Guarantee�in�respect�thereof. “Default��means�any�event�or�condition�which� constitutes�an�Event�of�Default�or�which�upon notice,�lapse�of�time�or�both�would,�unless�cured�or�waived,�become�an�Event�of�Default. “Default� Right�� has� the� meaning� assigned� to� that� term� in,� and� shall� be� interpreted� in accordance�with,�12�C.F.R.��252.81,�47.2�or�382.1,�as�applicable. “Defaulting�Lender��means�any�Lender�that�(a��has�failed,�within�three�(3��Business�Days�of�the date� required� to� be� funded� or� paid,� to� (i�� fund� any� portion� of� its� Loans,� (ii�� fund� any� portion� of� its participations� in� Letters� of� Credit� or� Swingline� Loans� or� (iii�� pay� over� to� any� Credit� Party� any� other amount�required�to�be�paid�by�it�hereunder,�unless,�in�the�case�of�clause�(i��above,�such�Lender�notifies the� Administrative� Agent� in� writing� that� such� failure� is� the� result� of� such� Lender�s� good� faith determination�that�a�condition�precedent�to�funding�(specifically�identified�and�including�the�particular default,�if�any��has�not�been�satisfied,�(b��has�notified�the�Company�or�any�Credit�Party�in�writing,�or�has made�a�public�statement�to�the�effect,�that�it�does�not�intend�or�expect�to�comply�with�any�of�its�funding obligations�under�this�Agreement�(unless�such�writing�or�public�statement�indicates�that�such�position�is based�on�such�Lender�s�good�faith�determination�that�a�condition�precedent�(specifically�identified�and including�the�particular�default,�if�any��to�funding�a�loan�under�this�Agreement�cannot�be�satisfied��or generally�under�other�agreements�in�which�it�commits�to�extend�credit,�(c��has�failed,�within�three�(3� Business�Days�after�request�by�the�Company�or�the�Administrative�Agent,�acting�in�good�faith,�to�provide a�certification�in�writing�from�an�authori�ed�officer�of�such�Lender�that�it�will�comply�with�its�obligations 15

combination�of�these�transactions��provided�that�no�phantom�stock�or�similar�plan�providing�for�payments only�on�account�of�services�provided�by�current�or�former�directors,�officers,�employees�or�consultants�of the�Parent�or�the�Subsidiaries�shall�be�a�Hedging�Agreement. “Impacted� Interest� Period�� has� the� meaning� assigned� to� such� term� in� the� definition� of� “LIBO Rate�. “Increasing�Lender��has�the�meaning�assigned�to�such�term�in�Section�2.20. “Incremental�Term�Loan��has�the�meaning�assigned�to�such�term�in�Section�2.20. “Incremental�Term�Loan�Amendment��has�the�meaning�assigned�to�such�term�in�Section�2.20. “Indemnified�Taxes��means�(a��Taxes�other�than�Excluded�Taxes�imposed�on�or�with�respect�to any�payment�made�by�any�Loan�Party�under�any�Loan�Document�and�(b��Other�Taxes. “Indemnitee��has�the�meaning�assigned�to�such�term�in�Section�9.03(b�. “Ineligible�Institution��has�the�meaning�assigned�to�such�term�in�Section�9.04(b�. “Information��has�the�meaning�assigned�to�such�term�in�Section�9.12. “Initial�Affiliate�Borrower��means�Hoffman�Schroff�Holdings,�Inc.�(formerly�known�as�Pentair Technical�Products�Holdings,�Inc.�,�a�Delaware�corporation. “Insolvency�Regulation��shall�mean�the�Regulation�EU�2015/848�of�the�European�Parliament�and of�the�Council�of�20�May�2015�on�insolvency�proceedings�(recast�. “Interest�Coverage�Ratio��means,�for�any�period,�the�ratio�of�(i��EBITDA�for�such�period�to�(ii� Interest�Expense�for�such�period. “Interest�Expense��means,�for�any�period,�the�sum,�without�duplication,�of�consolidated�interest expense�of�the�Parent�and�its�Subsidiaries�for�such�period�(including,�in�each�case�to�the�extent�included�in interest�expense�on�the�Parent�s�consolidated�income�statement,�the�interest�component�of�capital�leases, the�interest�component�of�Synthetic�Lease�Obligations,�facility,�commitment�and�usage�fees,�and�fees�for standby�letters�of�credit�,�plus�consolidated�yield�or�discount�accrued,�during�such�period�on�the�aggregate outstanding�investment�or�claim�held�by�purchasers,�assignees�or�other�transferees�of�(or�of�interests�in� receivables� of� the� Parent� and� its� Subsidiaries� in� connection� with� any� Securiti�ation� Transaction (regardless�of�the�accounting�treatment�of�such�Securiti�ation�Transaction�,�plus�net�payments�(if�any� pursuant�to�Hedging�Agreements,�minus�the�sum�(without�duplication��of�(a��annual�administrative�agent fees,� (b��costs� associated� with� obtaining� swap� agreements� and� any� interest� expense� attributable�to�the movement� of� the� mark-to-market� valuation� of� obligations� under� swap� agreements� or� other� derivative instruments�and�any�one-time�costs�associated�with�breakage�in�respect�of�swap�agreements�for�interest rates,�(c��costs�associated�with�the�issuance�or�incurrence�of�debt,�including�amorti�ation�and�write-off�of deferred�and�other�financing�fees,�debt�issuance�costs,�commissions,�fees�and�expenses�and�original�issue discount,� (d�� PIK� interest,� (e�� any� non-cash� expense� in� respect� of� any� interest� component� relating� to accretion�or�accrual�of�discounted�liabilities�and�(f��net�receipts�(if�any��pursuant�to�Hedging�Agreements. 22

(ii� in�whose�hands�any�interest�payable�in�respect�of�money�so�advanced�is taken�into�account�in�computing�the�trading�income�of�that�company��and (iii� which�has�complied�with�the�notification�requirements�set�out�in�Section 246(5�(a��of�the�Irish�TCA. (d� a�qualifying�company�within�the�meaning�of�Section�110�of�the�Irish�TCA��or (e� an�investment�undertaking�within�the�meaning�of�Section�739B�of�the�Irish�TCA��or (f� an�Irish�Treaty�Lender��or (g� an�exempted�approved�scheme�within�the�meaning�of�Section�774�of�the�Irish�TCA. “Irish�TCA��means�the�Taxes�Consolidation�Act,�1997�of�Ireland. “Irish�Treaty�Lender��means�a�Lender�which�is�on�the�date�the�relevant�payment�is�made�entitled under�a�double�taxation�agreement�(an�“Irish�Treaty��in�force�on�that�date�between�Ireland�and�another jurisdiction� to� that� payment� without� any� withholding� for� or� on� account� of� Irish� Tax� (subject� to� the completion�of�any�procedural�formalities��and�which�does�not�carry�on�a�business�in�Ireland�through�a permanent�establishment�with�which�that�Lender�s�participation�in�the�Loan�is�effectively�connected. “Issuing�Bank��means�each�of�JPMCB,�Bank�of�America,�N.A.,�MUFG�Bank,�Ltd.�(f/k/a�The Bank�of�Tokyo-Mitsubishi�UFJ,�Ltd.�,�Citibank,�N.A.,�U.S.�Bank�National�Association�and�each�other Lender�designated�by�the�Company�as�an�“Issuing�Bank��hereunder�that�has�agreed�to�such�designation (and�is�reasonably�acceptable�to�the�Administrative�Agent�,�each�in�its�capacity�as�the�issuer�of�Letters�of Credit�hereunder,�and�its�successors�in�such�capacity�as�provided�in�Section�2.06(i�.��Each�Issuing�Bank may,�in�its�discretion,�arrange�for�one�or�more�Letters�of�Credit�to�be�issued�by�Affiliates�or�branches�of such�Issuing�Bank,�in�which�case�the�term�“Issuing�Bank��shall�include�any�such�Affiliate�or�branch,�as applicable,�with�respect�to�Letters�of�Credit�issued�by�such�Affiliate. “JPMCB��means�JPMorgan�Chase�Bank,�N.A. “Knowledge�� means� the� actual� knowledge� of� a� Responsible� Officer,� without� giving� effect� to imputed�or�constructive�knowledge�or�giving�rise�to�any�duty�to�investigate. “LC�Disbursement��means�a�payment�made�by�an�Issuing�Bank�pursuant�to�a�Letter�of�Credit. “LC�Exposure��means,�at�any�time,�the�sum�of�(a��the�aggregate�undrawn�Dollar�Amount�of�all outstanding�Letters�of�Credit�at�such�time�which�are�then�available�plus�(b��the�aggregate�Dollar�Amount of�all�LC�Disbursements�that�have�not�yet�been�reimbursed�by�or�on�behalf�of�the�Company�at�such�time. The�LC�Exposure�of�any�Revolving�Lender�at�any�time�shall�be�its�Applicable�Percentage�of�the�total�LC Exposure�at�such�time. “Lender�Notice�Date��has�the�meaning�assigned�to�such�term�in�Section�2.25(b�. “Lender� Parent�� means,� with� respect� to� any� Lender,� any� Person� as� to� which� such� Lender� is, directly�or�indirectly,�a�subsidiary. “Lenders�� means� the� Persons� listed� on� Schedule� 2.01� and� any� other� Person� that� shall� have become�a�Lender�hereunder�pursuant�to�Section�2.20�or�pursuant�to�an�Assignment�and�Assumption�or 25

“Permitted�Acquisition��means�any�Acquisition�by�the�Parent�or�a�Subsidiary�which�satisfies�each of�the�following�requirements:�(i��no�Event�of�Default�or�Default�has�occurred�and�is�continuing�at�the time�of,�or�will�result�upon�giving�effect�to,�such�Acquisition��and�(ii��in�the�case�of�the�Acquisition�of�any Person,�the�board�of�directors�(or�equivalent�governing�body��of�the�Person�being�acquired�(or�all�of�the equity�holders�thereof��shall�have�approved�such�Acquisition. “Person��means�an�individual,�partnership,�corporation,�limited�liability�company,�business�trust, joint�stock�company,�trust,�unincorporated�association,�joint�venture�or�Governmental�Authority. “Plan�� means� at� any� time� an� employee� pension� benefit� plan� which� is� covered� by� Title� IV� of ERISA� or� subject� to� the� minimum� funding� standards� under� Section� 412� of� the� Code� and� is� either� (i� maintained�by�the�Parent�or�any�ERISA�Affiliate�for�employees�of�the�Parent�or�such�ERISA�Affiliate�or (ii��maintained�pursuant�to�a�collective�bargaining�agreement�or�any�other�arrangement�under�which�more than�one�employer�makes�contributions�and�to�which�the�Parent�or�any�ERISA�Affiliate�is�then�making�or accruing� an� obligation� to� make� contributions� or� has� within� the� preceding� five� plan� years� made contributions. “Plan�Asset�Regulations��means�29�CFR��2510.3-101�et seq.,�as�modified�by�Section�3(42��of ERISA,�as�amended�from�time�to�time. “Pounds�Sterling��means�the�lawful�currency�of�the�United�Kingdom. “Prime� Rate�� means� the� rate� of� interest�last�quoted� by� The�Wall�Street� Journal� as� the� “Prime Rate��in�the�U.S.�or,�if�The�Wall�Street�Journal�ceases�to�quote�such�rate,�the�highest�per�annum�interest rate�published�by�the�Board�in�Federal�Reserve�Statistical�Release�H.15�(519��(Selected�Interest�Rates��as the�“bank�prime�loan��rate�or,�if�such�rate�is�no�longer�quoted�therein,�any�similar�rate�quoted�therein�(as determined�in�good�faith�by�the�Administrative�Agent��or�any�similar�release�by�the�Board�(as�determined in�good�faith�by�the�Administrative�Agent�.�Each�change�in�the�Prime�Rate�shall�be�effective�from�and including�the�date�such�change�is�publicly�announced�or�quoted�as�being�effective. “PTE��means�a�prohibited�transaction�class�exemption�issued�by�the�U.S.�Department�of�Labor, as�any�such�exemption�may�be�amended�from�time�to�time. “Public� Debt� Rating�� the� rating� that� has� been� most� recently� announced� by� S�P,� Moody�s� or Fitch,�as�the�case�may�be,�for�any�class�of�non-credit�enhanced�long-term�senior�unsecured�debt�issued�by the�Company�(or�if�no�such�rating�is�then�in�effect�with�respect�to�such�debt,�then�the�corporate,�issuer�or similar� rating� with�respect�to�the�Parent,�that�has�been�most�recently�announced�by�S�P,�Moody�s�or Fitch,�as�the�case�may�be�,�or,�if�any�such�rating�agency�shall�have�issued�more�than�one�such�rating,�the lowest�such�rating�issued�by�such�rating�agency. “QFC��has�the�meaning�assigned�to�the�term�“qualified�financial�contract��in,�and�shall�be interpreted�in�accordance�with,�12�U.S.C.�5390(c�(8�(D�. “QFC�Credit�Support��has�the�meaning�assigned�to�it�in�Section�9.18. “Quotation�Day��means,�with�respect�to�any�Eurocurrency�Borrowing�for�any�Interest�Period,�(i� if�the�currency�is�Pounds�Sterling,�the�first�day�of�such�Interest�Period,�(ii��if�the�currency�is�euro,�the�day that� is� two� (2�� TARGET2� Days� before� the� first� day� of� such� Interest� Period,� and� (iii�� for� any� other currency,�two�(2��Business�Days�prior�to�the�commencement�of�such�Interest�Period�(unless,�in�each�case, market�practice�differs�in�the�relevant�market�where�the�LIBO�Rate�for�such�currency�is�to�be�determined, in� which� case� the� Quotation� Day� will� be� determined� by� the�Administrative� Agent� in� accordance� with 30

one�or�more�intermediaries,�or�both,�by�such�Person.��Unless�otherwise�specified,�all�references�herein�to�a “Subsidiary��or�to�“Subsidiaries��shall�refer�to�a�Subsidiary�or�Subsidiaries�of�the�Parent. “Supported�QFC��has�the�meaning�assigned�to�it�in�Section�9.18. “Surviving�Commitment��has�the�meaning�assigned�to�such�term�in�Section�2.09(b�. “Surviving�Lender��has�the�meaning�assigned�to�such�term�in�Section�2.09(b�. “Swingline� Exposure�� means,� at� any� time,� the� aggregate� principal� Dollar� Amount� of� all Swingline�Loans�outstanding�at�such�time.��The�Swingline�Exposure�of�any�Lender�at�any�time�shall�be the�sum�of�(a��its�Applicable�Percentage�of�the�total��Swingline�Exposure�at�such�time�other�than�with respect�to�any�Swingline�Loans�made�by�such�Lender�in�its�capacity�as�a�Swingline�Lender�and�(b��the aggregate�principal�Dollar�Amount�of�all�Swingline�Loans�made�by�such�Lender�as�a�Swingline�Lender outstanding�at�such�time�(less�the�Dollar�Amount�of�participations�funded�by�the�other�Revolving�Lenders in�such�Swingline�Loans�. “Swingline�Foreign�Currency�Sublimit��means�$30,000,000. “Swingline�Lenders��means�each�of�JPMCB,�Bank�of�America,�N.A.,�MUFG�Bank,�Ltd.�(f/k/a The� Bank� of� Tokyo-Mitsubishi� UFJ,� Ltd.�,� Citibank,� N.A.,� U.S.� Bank� National� Association� and� each other� Lender� designated� by� the� Company� as� a� “Swingline� Lender�� hereunder� that� has� agreed� to� such designation�(and�is�reasonably�acceptable�to�the�Administrative�Agent�,�each�in�its�capacity�as�a�lender�of Swingline�Loans�hereunder. “Swingline�Loan��means�a�Loan�made�pursuant�to�Section�2.05. “Swingline�Sublimit�� means� as� to� any� Lender� (i��the�amount� set�forth� opposite� such�Lender�s name�on�Schedule�2.05�hereof�or�(ii��if�such�Lender�has�entered�into�an�Assignment�and�Assumption,�the amount� set� forth� for� such� Lender� as� its� Swingline� Sublimit� in� the� Register� maintained� by� the Administrative�Agent�pursuant�to�Section�9.04(b�(iv��(provided�that,�in�the�case�of�each�of�the�foregoing clauses�(i��and�(ii�,�any�increase�in�the�Swingline�Sublimit�with�respect�to�any�Lender�shall�only�require the�consent�of�the�Company�and�such�Lender�. “Swiss�Borrower��means�any�Affiliate�Borrower�organi�ed�under�the�laws�of�Swit�erland�or,�if different,�is�deemed�resident�in�Swit�erland�for�Swiss�Withholding�Tax�purposes�pursuant�to�Article�9�of the�Swiss�Withholding�Tax�Act. “Swiss�Guidelines��means,�together,�the�guidelines�S-02.122.1�in�relation�to�bonds�of�April�1999 as� issued� by� the� Swiss� Federal� Tax� Administration� (Merkblatt S-02.122.1 vom April 1999 betreffend “Obligationen”�,�S-02.123�in�relation�to�inter�bank�transactions�of�22�September�1986�as�issued�by�the Swiss�Federal�Tax�Administration�(Merkblatt S-02.123 vom 22 September 1986 betreffend Zinsen von Bankguthaben, deren Gläubiger Banken sind (Interbankguthaben)�,�S-02.128�in�relation�to�syndicated credit� facilities� of� January� 2000� (Merkblatt S-02.128 vom Januar 2000 “Steuerliche Behandlung von Konsortialdarlehen, Schuldscheindarlehen, Wechseln und Unterbeteiligungen”�,�S-02.130.1�in�relation�to money� market� instruments� and� book� claims� of� April� 1999� (Merkblatt S-02.130.1 vom April 1999 “Geldmarktpapiere und Buchforderungen inländischer Schuldner”�,� the� circular� letter� No.� 15� (1-015- DVS-2007��of�7�February�2007�in�relation�to�bonds�and�derivative�financial�instruments�as�subject�matter of�taxation�of�Swiss�federal�income�tax,�Swiss�withholding�tax�and�Swiss�stamp�taxes�(Kreisschreiben Nr. 15 “Obligationen und derivative Finanzinstrumente als Gegenstand der direkten Bundessteuer, der Verrechnungssteuer und der Stempelabgaben” vom 3. Oktober 2017��and�the�circular�letter�No.�34�of�26 35

“Syndication�Agent��means�each�of�Bank�of�America,�N.A.,�MUFG�Bank,�Ltd.�(f/k/a�The�Bank of�Tokyo-Mitsubishi�UFJ,�Ltd.�,�Citibank,�N.A.�and�U.S.�Bank�National�Association�in�its�capacity�as syndication�agent�for�the�credit�facilities�evidenced�by�this�Agreement. “Synthetic�Lease�Obligations��means�obligations�under�operating�leases�(as�determined�pursuant to� Statement� of� Financial� Accounting� Standards� No.� 13�� of� properties� which� are� reported� for� United States� income� tax� purposes� as� owned� by� the� Parent� or� a� Consolidated� Subsidiary.� � The� amount� of Synthetic�Lease�Obligations�under�any�such�lease�shall�be�determined�in�accordance�with�GAAP�as�if such�operating�lease�were�a�capital�lease. “TARGET2�� means� the� Trans-European� Automated� Real-time� Gross� Settlement� Express Transfer� (TARGET2�� payment� system� (or,� if� such� payment�system�ceases� to� be� operative,� such� other payment�system�(if�any��reasonably�determined�by�the�Administrative�Agent�to�be�a�suitable�replacement� for�the�settlement�of�payments�in�euro. “TARGET2�Day��means�a�day�that�TARGET2�is�open�for�the�settlement�of�payments�in�euro. “Taxes��means�any�and�all�present�or�future�taxes,�levies,�imposts,�duties,�deductions,�fees,�value added�taxes,�or�any�other�goods�and�services,�use�or�sales�taxes,�assessments,�charges�or�withholdings imposed�by�any�Governmental�Authority,�including�any�interest,�additions�to�tax�or�penalties�applicable thereto. “Term� Lender�� means,� as� of� any� date� of� determination,� each� Lender� having� a� Term� Loan Commitment�or�that�holds�Term�Loans. “Term�Loan�Commitment��means�(a��as�to�any�Term�Lender,�the�aggregate�commitment�of�such Term�Lender�to�make�Term�Loans�as�set�forth�on�Schedule�2.01�or�in�the�Assignment�and�Assumption�or other�documentation�or�record�(as�such�term�is�defined�in�Section�9-102(a�(70��of�the�New��ork�Uniform Commercial� Code�� as� provided� in� Section� 9.04(b�(ii�(C�� or� other� documentation� contemplated� hereby pursuant�to�which�such�Lender�shall�have�assumed�its�Term�Loan�Commitment,�as�applicable�and�(b��as to� all� Term� Lenders,� the� aggregate� commitment� of� all� Term� Lenders� to� make� Term� Loans,� which aggregate�commitment�shall�be�$200,000,000�on�the�date�of�this�Agreement.��After�advancing�the�Term Loan,� each� reference� to� a� Term� Lender�s� Term� Loan� Commitment� shall� refer� to� that� Term� Lender�s Applicable�Percentage�of�the�Term�Loans. “Term�Loan�Maturity�Date��means�the�five�year�anniversary�of�the�Closing�Date,�as�extended�(in the�case�of�each�Term�Lender�consenting�thereto��pursuant�to�Section�2.25. “Term� Loans�� means� the� term� loans� made� by� the� Term� Lenders� to� the� Company� pursuant� to Section�2.01(b�. “Total� Revolving� Credit� Exposure�� means,� at� any� time,� the� sum� of� the� outstanding� principal amount�of�all�Revolving�Lenders��Revolving�Loans,�their�LC�Exposure�and�their�Swingline�Exposure�at such�time��provided,�that�clause�(a��of�the�definition�of�Swingline�Exposure�shall�only�be�applicable�to�the extent�Revolving�Lenders�shall�have�funded�their�respective�participations�in�the�outstanding�Swingline Loans. “Trade�Date��has�the�meaning�specified�in�Section�9.04(e�(i��hereof. 37

“Transaction� Expenses�� has� the� meaning� assigned� to� such� term� in� the� definition� of� “Spinoff Transactions�. “Transactions�� means� the� execution,� delivery� and� performance� by� the� Loan� Parties� of� this Agreement�and�the�other�Loan�Documents,�the�borrowing�of�Loans,�the�use�of�the�proceeds�thereof,�the issuance�of�Letters�of�Credit�hereunder,�the�Spinoff�and�the�Spinoff�Transactions. “Type�,�when�used�in�reference�to�any�Loan�or�Borrowing,�refers�to�whether�the�rate�of�interest on�such�Loan,�or�on�the�Loans�comprising�such�Borrowing,�is�determined�by�reference�to�the�Adjusted LIBO�Rate�or�the�Alternate�Base�Rate. “Unfunded�Vested�Liabilities��means,�with�respect�to�any�Plan�at�any�time,�the�amount�(if�any� by�which�(i��the�current�liability�as�defined�in�Section�412(l�(7��of�the�Code�under�such�Plan�exceeds�(ii� the�fair�market�value�of�all�Plan�assets�allocable�to�such�benefits,�all�as�determined�as�of�the�then�most recent�valuation�date�for�such�Plan,�but�only�to�the�extent�that�such�excess�represents�a�potential�liability of�the�Parent�or�any�ERISA�Affiliate�to�the�PBGC�or�such�Plan�under�Title�IV�of�ERISA. “United�States��and�“U.S.��each�mean�the�United�States�of�America. “U.S.�Lender��means�a�Lender�that�is�not�a�Foreign�Lender. “U.S.�Person��means�a�“United�States�person��within�the�meaning�of�Section�7701(a�(30��of�the Code. “U.S.�Special�Resolution�Regime��has�the�meaning�assigned�to�it�in�Section�9.18. “UK�Bankruptcy�Event��means: (a� a�UK�Relevant�Entity�is�unable�or�admits�inability�to�pay�its�debts�(as�defined�in�section 123(1�(a��of�the�Insolvency�Act�1986��as�they�fall�due�or�is�deemed�to�or�declared�to�be�unable�to�pay�its debts�under�applicable�law,�or�suspends�or�threatens�to�suspend�making�payments�on�any�of�its�debts�or, by�reason�of�actual�or�anticipated�financial�difficulties��or (b� any�corporate�action,�legal�proceedings�or�other�formal�procedure�or�formal�step�for�(i� the�suspension�of�payments,�a�moratorium�of�any�indebtedness,�winding-up,�dissolution,�administration�or reorgani�ation� (by� way� of� voluntary� arrangement,� scheme� of� arrangement� or� otherwise�� of� any� UK Relevant�Entity��(ii��a�composition,�compromise,�assignment�or�arrangement�with�any�creditor�of�any�UK Relevant�Entity��or�(iii��the�appointment�of�a�liquidator,�receiver,�administrative�receiver,�administrator, compulsory�manager�or�other�similar�officer�in�respect�of�any�UK�Relevant�Entity,�or�any�of�the�assets�of any�UK�Relevant�Entity��save�that�this�paragraph�(b��shall�not�apply�to�any�action,�proceeding,�procedure or�formal�step�which�is�frivolous�or�vexatious�and�is�discharged,�stayed�or�dismissed�within�14�days�of commencement. “UK�Borrower��means�any�Affiliate�Borrower�resident�for�tax�purposes�in�England�and�Wales. “UK�Borrower�DTTP�Filing��means�an�HM�Revenue��Customs��Form�DTTP2,�duly�completed and�filed�by�the�relevant�UK�Borrower,�which: (a� where�it�relates�to�a� UK� Treaty� Lender�that�is�a�Lender�on�the�day� this�Agreement�is entered�into�(or�any�amendment�hereto�,�contains�the�scheme�reference�number�and�jurisdiction�of�tax 38

financial�statements�delivered�pursuant�to�Section�5.01(a��and�5.01(b��shall�be�prepared�without�giving effect�to�this�sentence�. SECTION�1.05 Interest� Rates.� � The� Administrative� Agent� does� not� warrant� or� accept responsibility�for,�and�shall�not�have�any�liability�with�respect�to,�the�administration,�submission�or�any other�matter�related�to�the�rates�in�the�definition�of�“LIBO�Rate��or�with�respect�to�any�comparable�or successor�rate�thereto,�or�replacement�rate�therefor�(other�than,�for�the�avoidance�of�doubt,�with�respect�to its�obligation�to�apply�the�definition�of�such�rate�in�accordance�with�its�terms�. SECTION�1.06 Luxembourg�Terms.��Notwithstanding�any�other�provision�of�this�Agreement�to the�contrary,�in�this�Agreement�where�it�relates�to�any�Affiliate�Borrower�which�is�organi�ed�under�the laws�of�Luxembourg,�a�reference�to:�(a��a�receiver,�conservator,�trustee,�administrator,�custodian,�assignee for� the� benefit� of� creditors,� compulsory� manager� or� other� similar� officer� includes� a� juge délégué, commissaire, juge-commissaire, mandataire ad hoc, administrateur provisoire, liquidateur�or�curateur� (b�� liquidation,� bankruptcy,� insolvency,� reorgani�ation,� moratorium� or� any� similar� proceeding� shall include� (i�� insolvency/bankruptcy (faillite) within� the� meaning� of� Articles� 437� ff.� of� the� Luxembourg Commercial�Code, (ii��controlled�management (gestion contrôlée) within�the�meaning�of�the�grand�ducal regulation� of� 24� May� 1935� on� controlled� management,� (iii�� voluntary� arrangement� with� creditors (concordat préventif de la faillite) within�the�meaning�of�the�law�of�14�April�1886�on�arrangements�to prevent�insolvency,�as�amended,�(iv��suspension�of�payments (sursis de paiement) within�the�meaning�of Articles� 593� ff.� of� the� Luxembourg� Commercial� Code�or� (v�� voluntary� or� compulsory� winding-up pursuant� to� the� law� of� 10� August� 1915� on� commercial� companies,� as� amended,� (c�� a� lien� or� security interest�includes�any�hypothèque, nantissement, gage, privilège, sûreté réelle, droit de rétention,�and�any type� of� security� in� rem� (sûreté réelle�� or� agreement� or� arrangement� having� a� similar� effect� and� any transfer�of�title�by�way�of�security��(d��a�person�being�unable�to�pay�its�debts�includes�that�person�being�in a�state�of�cessation�of�payments�(cessation de paiements��or�having�lost�or�meeting�the�criteria�to�lose�its commercial�creditworthiness�(ébranlement de crédit��(e��attachments�or�similar�creditors�process�means an�executory�attachment�(saisie exécutoire��or�conservatory�attachment�(saisie arrêt��and�(f��a�“set-off� includes,�for�purposes�of�Luxembourg�law,�legal�set-off. SECTION�1.07 Certain�Calculations.��No�Default�or�Event�of�Default�shall�arise�as�a�result�of�any limitation�or�threshold�set�forth�in�Dollars�in��Articles�VI�and�VII�under�this�Agreement�being�exceeded solely�as�a�result�of�changes�in�currency�exchange�rates�from�those�rates�applicable�on�the�last�day�of�the fiscal� quarter� of� the� Parent� immediately� preceding� the� fiscal� quarter� of� the� Parent� in� which� such transaction�requiring�a�determination�occurs. SECTION�1.08Divisions.��For�all�purposes�under�the�Loan�Documents,�in�connection�with any�division�or�plan�of�division�under�Delaware�law�(or�any�comparable�event�under�a�different jurisdiction�s�laws�:�(a��if�any�asset,�right,�obligation�or�liability�of�any�Person�becomes�the�asset, right,�obligation�or�liability�of�a�different�Person,�then�it�shall�be�deemed�to�have�been�transferred from�the�original�Person�to�the�subsequent�Person,�and�(b��if�any�new�Person�comes�into�existence, such� new� Person� shall� be� deemed� to� have� been� organi�ed� and� acquired� on� the� first� date� of� its existence�by�the�holders�of�its�equity�interests�at�such�time. ARTICLE�II. THE�CREDITS SECTION�2.01 Commitments.� � Subject� to� the� terms� and� conditions� set� forth� herein,� (a�� each Revolving�Lender�(severally�and�not�jointly��agrees�to�make�Revolving�Loans�to�the�Borrowers�in�Agreed Loan�Currencies�from�time�to�time�during�the�Availability�Period�in�an�aggregate�principal�amount�that 42

expected�to�have�a�Material�Adverse�Effect.��Under�the�laws�of�Luxembourg�it�is�not�necessary�that�the Loan�Documents�be�filed,�recorded�or�enrolled�with�any�court�or�other�authority�in�any�jurisdiction�or�that any� stamp,� registration� or� similar� Taxes� be� paid� on� or� in� relation� to� the� Loan� Documents� or� the transactions�contemplated�by�the�Loan�Documents,�except�(i��where�the�Loan�Documents�are�physically attached�(annexé(s)��to�a�public�deed�or�to�any�other�document�subject�to�mandatory�registration,�in�which case� either� a� nominal� registration� duty� or� an� ad valorem� duty� (of,� for� instance,� 0.24� per� cent.� of� the amount�of�the�payment�obligation�mentioned�in�the�document�so�registered��will�be�payable�depending�on the� nature� of� the� document� to� be� registered,� and� (ii�� in� the�case�of� voluntary� registration� of�the� Loan Documents. SECTION�3.08 Not�an�Investment�Company.�Neither�the�Parent�nor�any�Subsidiary�thereof�is�an “investment�company��within�the�meaning�of�the�Investment�Company�Act�of�1940. SECTION�3.09 Environmental�Matters.��The�Parent�conducts�in�the�ordinary�course�of�business�a review�of�the�effect�of�existing�Environmental�Laws�and�existing�Environmental�Claims�on�the�business, operations� and� properties� of� the� Parent� and� its� Subsidiaries,� and� as� a� result� thereof� the� Parent� has reasonably�concluded�that�such�Environmental�Laws�and�Environmental�Claims�could�not,�individually�or in�the�aggregate,�reasonably�be�expected�to�have�a�material�adverse�effect�on�the�business,�consolidated financial�position�or�consolidated�results�of�operations�of�the�Parent�and�its�Subsidiaries�taken�as�a�whole. SECTION�3.10 Use� of� Proceeds.� � The� Borrowers� will� use� the� proceeds� of� the� Credit� Events solely�for�the�purposes�described�in�Section�5.02. SECTION�3.11 Disclosure.� � No� written� report,� financial� statement,� certificate� or� other� written information�furnished�by�or�on�behalf�of�any�Loan�Party�to�the�Administrative�Agent�or�any�Lender�in connection�with�the�transactions�contemplated�hereby�and�the�negotiation�of�this�Agreement�or�delivered hereunder� or� under� any� other� Loan� Document� (in� each� case,� as� modified� or� supplemented� by� other information�so�furnished��contains�any�material�misstatement�of�fact�or�omits�to�state�any�material�fact necessary�to�make�the�statements�therein,�in�the�light�of�the�circumstances�under�which�they�were�made, not�misleading�when�taken�as�a�whole��provided�that,�with�respect�to�projected�financial�information,�such Loan� Party� represents�only� that� such� information� was�prepared�in� good� faith� based� upon� assumptions believed�to�be�reasonable�at�the�time�(it�being�understood�and�agreed�that�projected�financial�information is�simply�an�estimate,�and�there�is�no�guarantee�that�projected�results�will�in�fact�be�achieved�.��As�of�the Amendment�No.�1�Effective�Date,�to�the�best�knowledge�of�the�Company,�the�information�included in�the�Beneficial�Ownership�Certification�provided�on�or�prior�to�the�Amendment�No.�1�Effective Date�to�any�Lender�in�connection�with�this�Agreement�is�true�and�correct�in�all�material�respects. SECTION�3.12 Anti-Corruption�Laws�and�Sanctions. (a� Each� of� the� Parent� and� its� Subsidiaries�and,� to� its� Knowledge,� its� controlled� affiliated companies�and�their�respective�directors,�officers,�employees,�and�agents�are�conducting�their�business�in compliance� in� all� material� respects� with� Anti-Corruption� Laws� and� have� instituted� and� maintained policies� and� procedures� designed� to� promote� and� achieve� compliance� with� such� laws� in� all� material respects. (b� None� of� the� Parent� or� its� Subsidiaries� or,� to� its� Knowledge,�their� respective� directors, officers,�employees�or�agents�acting�in�any�capacity�in�connection�with,�or�directly�benefiting�from,�the Credit�Events: (i� is�a�Designated�Person� 84

members�of�a�group�of�companies�consisting�of�a�holding�company�and�its�subsidiaries�for�the�purposes of�Section�243�of�the�Irish�Companies�Act. SECTION�3.17 Tax� Residence.� � Each� Loan� Party� (other� than� the� Parent�� represents� that� it� is resident�for�Tax�purposes�only�in�its�jurisdiction�of�incorporation.��The�Parent�represents�that�it�is�resident for�Tax�purposes�only�in�Ireland�or�the�United�Kingdom. ARTICLE�IV. CONDITIONS SECTION�4.01 Effective�Date.��This�Agreement�and�the�other�Loan�Documents�shall�not�become effective�until�the�date�on�which�each�of�the�following�conditions�is�satisfied�(or�waived�in�accordance with�Section�9.02�: (a� The�Administrative�Agent�(or�its�counsel��shall�have�received�from�each�party hereto�either�(i��a�counterpart�of�this�Agreement�signed�on�behalf�of�such�party�or�(ii��written evidence� satisfactory� to� the� Administrative� Agent� (which� may� include� telecopy� or� electronic transmission� of� a� signed� signature� page� of� this� Agreement�� that� such� party� has� signed� a counterpart�of�this�Agreement. (b� The� Administrative� Agent� shall� have� received� a� favorable� written� opinion (addressed�to�the�Administrative�Agent�and�the�Lenders�and�dated�the�Effective�Date��of�(i��Foley ��Lardner�LLP,�special�counsel�for�the�Loan�Parties,�(ii��Arthur�Cox,�special�Irish�counsel�for�the Loan�Parties,�and�(iii��Allen��Overy,�Société en Commandite Simple, inscrite au barreau de Luxembourg,� special� Luxembourg� counsel� for� the� Loan� Parties,� substantially� in� the� form� of Exhibits�B-1,�B-2�and�B-3,�respectively,�and�covering�such�other�matters�relating�to�the�Parent, the� Company,� the� Initial� Affiliate� Borrower,� this� Agreement� or� the� Transactions� as� the Administrative� Agent� shall� reasonably� request.� � The� Company� hereby� requests� each� such counsels�to�deliver�such�opinions. (c� The�Administrative�Agent�shall�have�received�such�documents�and�certificates�as the� Administrative� Agent� or� its� counsel� may� reasonably� request� relating� to� the� organi�ation, existence�and�good�standing�of�the�Loan�Parties�(which�shall�include,�in�the�case�of�the�Irish�Loan Party,�evidence�that�such�Loan�Party�has�complied�with�Section�82�of�the�Companies�Act�2014�of Ireland�,�the�authori�ation�of�the�Transactions�and�any�other�legal�matters�relating�to�the�Parent, the�Company,�the�Initial�Affiliate�Borrower,�the�Loan�Documents�or�the�Transactions,�all�in�form and�substance�satisfactory�to�the�Administrative�Agent�and�its�counsel�and�as�further�described�in Section�I�of�the�list�of�closing�documents�attached�as�Exhibit�E. The� Administrative� Agent� shall� notify� the� Company� and� the� Lenders� of� the� Effective� Date,� and� such notice�shall�be�conclusive�and�binding. SECTION�4.02 Closing�Date.��The�obligations�of�the�Lenders�to�make�Loans�and�of�the�Issuing Banks�to�issue�Letters�of�Credit�hereunder�shall�not�become�effective�until�the�date�on�which�each�of�the following�conditions�is�satisfied�(or�waived�in�accordance�with�Section�9.02�: (a� The�Effective�Date�shall�have�occurred. 86

agreements�shall�have�been�waived,�amended,�supplemented�or�otherwise�modified�in�a�manner material�and�adverse�to�the�rights�or�interests�of�the�Lenders�without�the�prior�approval�of�the Administrative� Agent,� it� being� agreed� that� the� Administrative� Agent� will� act� reasonably� in making�any�such�determination. (i� The�Administrative�Agent�shall�have�received�evidence�satisfactory�to�it�that�the “Commitments�� under� (and� as� defined� in�� the� Pentair� Credit� Agreement� have� been� (or contemporaneously� with� the� Closing� Date� will� be�� ratably� and� permanently� reduced� to $800,000,000� or� less� (it� being� understood� that� such� reduction� may� be� effectuated� by� a commitment� reduction� under,� an� amendment� to,� an� amendment� and� restatement� of� or� a replacement�of�the�Pentair�Credit�Agreement�. (j� The�Administrative�Agent�shall�have�received�all�fees�and�other�amounts�due�and payable�on�or�prior�to�the�Closing�Date,�including,�to�the�extent�invoiced�(in�reasonable�detail��at least�one�(1��Business�Day�prior�to�the�Closing�Date,�reimbursement�or�payment�of�all�out-of- pocket�expenses�required�to�be�reimbursed�or�paid�by�the�Company�hereunder. The�Administrative�Agent�shall�notify�the�Company�and�the�Lenders�of�the�Closing�Date,�and�such�notice shall�be�conclusive�and�binding.��Notwithstanding�the�foregoing,�the�obligations�of�the�Lenders�to�make Loans�and�of�the�Issuing�Banks�to�issue�Letters�of�Credit�hereunder�shall�not�become�effective�unless each� of� the� foregoing� conditions�set� forth�in� this� Section�4.02�shall�have�been� satisfied� (or�waived� in accordance�with�Section�9.02��at�or�prior�to�5:00�p.m.,�New��ork�City�time,�on�May�31,�2018,�and�it�is hereby�understood�and�agreed�that�in�the�event�each�of�such�foregoing�conditions�shall�not�have�been�so satisfied�or�waived,�the�Commitments�shall�automatically�and�irrevocably�terminate�at�5:00�p.m.,�New �ork�City�time,�on�May�31,�2018. SECTION�4.03 Each�Credit�Event.��The�obligation�of�each�Lender�to�make�a�Loan,�and�of�the Issuing�Banks�to�issue,�increase,�renew�or�extend�any�Letter�of�Credit,�is�subject�to�the�satisfaction�of�the following�conditions: (a� the�representations�and�warranties�of�the�Borrowers�set�forth�in�this�Agreement (other�than�the�representations�contained�in�Sections�3.04(b��and�3.05��shall�be�true�and�correct�in all�material�respects�(provided�that�any�representation�or�warranty�that�is�qualified�by�materiality or�Material�Adverse�Effect�shall�be�true�and�correct�in�all�respects��on�and�as�of�the�date�of�such Loan�(or,�if�any�such�representation�or�warranty�is�expressly�stated�to�have�been�made�as�of�a specific�date,�as�of�such�specific�date��or�the�date�of�issuance,�amendment�to�increase,�renewal�or extension�of�such�Letter�of�Credit,�as�applicable. (b� At�the�time�of�and�immediately�after�giving�effect�to�such�Loan�or�the�issuance, amendment�to�increase,�renewal�or�extension�of�such�Letter�of�Credit,�as�applicable,�no�Default shall�have�occurred�and�be�continuing. Each�Loan�and�each�issuance,�amendment�to�increase,�renewal�or�extension�of�a�Letter�of�Credit�shall�be deemed�to�constitute�a�representation�and�warranty�by�the�Borrowers�on�the�date�thereof�as�to�the�matters specified�in�paragraphs�(a��and�(b��of�this�Section. SECTION�4.04 Designation�of�an�Affiliate�Borrower.��The�designation�of�an�Affiliate�Borrower pursuant�to�Section�2.23�is�subject�to�the�conditions�precedent�that: 88

(a� The� Company� or� such� proposed� Affiliate� Borrower� shall� have� furnished� or caused�to�be�furnished�to�the�Administrative�Agent: (i� subject�to�clauses�(d��and�(e��below,�copies,�certified�by�the�Secretary�or Assistant�Secretary�(or�other�appropriate�officer,�manager�or�director��of�such�Subsidiary, of� its� board� of� directors�� (or� other� applicable� governing� body�s�� resolutions� (and resolutions� of� other� bodies,� if� any� are� deemed� necessary� by� counsel� for� the Administrative�Agent��approving�the�Affiliate�Borrowing�Agreement�and�any�other�Loan Documents� to� which� such� Subsidiary� is� becoming� a� party� and� such� documents� and certificates�as�the�Administrative�Agent�or�its�counsel�may�reasonably�request�relating�to the�organi�ation,�existence�and�good�standing�of�such�Subsidiary� (ii� an� incumbency� certificate,� executed� by� the� Secretary� or� Assistant Secretary�(or�other�appropriate�officer,�manager�or�director��of�such�Subsidiary,�which shall� identify� by� name� and� title� and� bear� the� signature� of� the� officers� or� other representatives�of�such�Subsidiary�authori�ed�to�request�Borrowings�hereunder�and�sign the� Affiliate� Borrowing� Agreement� and� the� other� Loan� Documents� to� which� such Subsidiary�is�becoming�a�party,�upon�which�certificate�the�Administrative�Agent�and�the Lenders�shall�be�entitled�to�rely�until�informed�of�any�change�in�writing�by�the�Company or�such�Subsidiary� (iii� opinions� of� counsel� to� such� Subsidiary� (which� may� include� inside counsel� to� such� Subsidiary� for� certain� matters�,� in� form� and� substance� reasonably satisfactory�to�the�Administrative�Agent�and�its�counsel,�with�respect�to�the�laws�of�its jurisdiction�of�organi�ation�and�such�other�matters�as�are�reasonably�requested�by�counsel to�the�Administrative�Agent�and�addressed�to�the�Administrative�Agent�and�the�Lenders� (iv� any� promissory� notes� requested� by� any� Lender,� and� any� other instruments� and� documents� reasonably� requested� by� the� Administrative� Agent� or� any Lender�(including�in�connection�with�the�Patriot�Act��and (v� any� documentation� and� other� information� related� to� such� Subsidiary reasonably�requested�by�the�Administrative�Agent�or�any�Lender�under�applicable�“know your� customer�� or� similar� rules� and� regulations,� including� the� Patriot� Act� and� the Beneficial�Ownership�Regulation� (b� The�Administrative�Agent�shall�have�received�evidence�satisfactory�to�it�that�all of� such� Affiliate� Borrower�s� then� existing� credit� facilities� shall� have� been� cancelled� and terminated� and� all� indebtedness� thereunder� shall� have� been� fully� repaid� (except� to� the� extent being�so�repaid�with�the�initial�Revolving�Loans�to�such�Borrower�or�otherwise�permitted�to�be outstanding�pursuant�to�this�Agreement�� (c� In�the�event�an�Affiliate�Borrower�is�organi�ed�under�the�laws�of�Luxembourg, (i��an�excerpt�(extrait��issued�by�the�Luxembourg�Trade�and�Companies�Register�dated�as�of�the date�of�its�designation�and�(ii��a�non-registration�certificate�(certificate de non-inscription d’une décision judiciaire�� issued� by� the� Luxembourg� Trade� and� Companies� Register� regarding� the absence�of�judicial�proceedings�dated�as�of�the�date�of�its�designation� (d� In�the�event�an�Affiliate�Borrower�is�organi�ed�under�the�laws�of�Swit�erland,�(i� a�copy�of�the�constitutional�documents�of�such�Affiliate�Borrower,�being�a�certified�excerpt�of�the competent� commercial� register,� a� certified� copy� of� the� articles� of� association� (containing� a 89

(c� Compliance� Certificates.� � Simultaneously� with� the� delivery� of� each� set� of� financial statements�referred�to�in�clauses�(a��and�(b��above,�a�certificate�of�a�Senior�Financial�Officer�(i��setting forth�in�reasonable�detail�the�calculations�required�to�establish�whether�the�Parent�was�in�compliance�with the� requirements� of� Sections� 6.01� and� 6.02� on� the� date� of� such� financial� statements� and� (ii�� stating whether�there�exists�on�the�date�of�such�certificate�any�Event�of�Default�or�Default�and,�if�any�such�event then�exists,�setting�forth�the�details�thereof�and�the�action�which�the�Parent�is�taking�or�proposes�to�take with�respect�thereto. (d� Notice�of�Default.��Forthwith�upon�the�occurrence�of�any�Responsible�Officer�obtaining knowledge�of�any�Event�of�Default�or�Default,�a�certificate�of�a�Senior�Financial�Officer�setting�forth�the details�thereof�and�the�action�which�the�Parent�is�taking�or�proposes�to�take�with�respect�thereto. (e� Shareholder�Information.��Promptly�upon�the�mailing�thereof�to�the�shareholders�of�the Parent�generally,�copies�of�all�financial�statements,�reports�and�proxy�statements�so�mailed. (f� SEC�Filings.��Promptly�upon�the�filing�thereof,�copies�of�all�registration�statements�(other than�the�exhibits�thereto�and�any�registration�statements�on�Form�S-8�or�its�equivalent��and�reports�on Forms�10-K�and�10-Q�which�the�Parent�shall�have�filed�with�the�SEC. (g� ERISA�Notices.��If�and�when�the�Parent�or�ERISA�Affiliate�or�is�required�to�give�notice to�the�PBGC�of�any�“reportable�event��(as�defined�in�Section�4043�of�ERISA��with�respect�to�any�Plan which�could�reasonably�be�expected�to�constitute�grounds�for�a�distress�or�PBGC-initiated�termination�of such� Plan�under� Title�IV�of�ERISA,�or� knows�that� the� plan�administrator�of�any� Plan�has�given� or�is required�to�give�notice�of�any�such�reportable�event,�a�copy�of�the�notice�of�such�reportable�event�given�or required�to�be�given�to�the�PBGC. (h� Notice�of�Other�Material�Events.��Promptly�upon�obtaining�knowledge�thereof,�notice�of the�commencement�of�any�litigation�or�Governmental�Authority�proceeding�affecting�the�Parent�or�any Subsidiary� (including� pursuant� to� any� applicable� Environmental� Law�� in� which� there� is� a� reasonable possibility�of�an�adverse�decision�which�could�reasonably�be�expected�to�have�a�Material�Adverse�Effect. (i� Ratings.��Promptly�upon�the�public�announcement�thereof,�notice�of�any�downgrade�in any� credit� rating� (including� the� Public� Debt� Rating�� with� respect� to� the� Company� or� the� Parent� by Moody�s,�S�P�or�Fitch. (j� Beneficial�Ownership�Certification�Changes.��Promptly�after�the�occurrence�thereof, notice� to� the� applicable� Lender� of� any� change� in� the� information� provided� in� the� Beneficial Ownership� Certification� delivered� to� such� Lender� that� would� result� in� a� change� to� the� list� of beneficial�owners�identified�in�such�certification. (k� K�C� Information.� � Promptly� following� any� request� therefor,� information� and documentation�reasonably�requested�by�the�Administrative�Agent�or�any�Lender�for�purposes�of compliance� with� applicable� “know� your� customer�� and� anti-money� laundering� rules� and regulations,�including�the�Patriot�Act�and�the�Beneficial�Ownership�Regulation. (l� (j��Other�Information.��From�time�to�timePromptly�following�any�request�therefor, such� additional� information� regarding� the� financial� position� or� business� of� the� Loan� Parties� as� the Administrative�Agent,�at�the�request�of�any�Lender,�may�reasonably�request.�(it�being�understood�and agreed�that�no�Loan�Party�nor�any�of�its�Subsidiaries�shall�be�required�to�disclose�or�discuss,�or permit�the�inspection,�examination�or�making�of�extracts�of,�any�records,�books,�information�or account�or�other�matter�(i��in�respect�of�which�disclosure�to�the�Administrative�Agent,�any�Lender 91

or�their�representatives�is�then�prohibited�by�applicable�law�or�any�agreement�binding�on�any�Loan Party�or�any�of�its�Subsidiaries,�(ii��that�is�protected�from�disclosure�by�the�attorney-client�privilege or� the� attorney� work� product� privilege� or� (iii��constitutes� non-financial� trade� secrets� or� non- financial�proprietary�information�. Documents� required� to� be� delivered� pursuant� to� Sections�3.04�or� 5.01�(to�the�extent� any� such documents�are�included�in�materials�otherwise�filed�with�the�SEC��may�be�delivered�electronically�and�if so� delivered,� shall� be� deemed� to� have� been� delivered� on� the� date� such� documents� are� posted� on� the Parent�s� behalf� on� SyndTrak/IntraLinks/IntraAgency,� on� EDGAR� (the� Electronic� Data� Gathering, Analysis�and�Retrieval�system�of�the�SEC��or�any�successor�thereto,�or�another�relevant�website,�if�any,�to which�each�Lender�and�the�Administrative�Agent�have�access�(whether�a�commercial,�third-party�website or�whether�sponsored�by�the�Administrative�Agent��provided�that,�except�in�the�case�of�any�filing�on EDGAR�or�any�successor�thereto,�the�Parent�shall�notify�(which�may�be�by�facsimile�or�electronic�mail� the�Administrative�Agent�and�each�Lender�of�the�posting�of�any�such�documents.��The�Administrative Agent�shall�have�no�obligation�to�request�the�delivery�or�to�maintain�copies�of�the�documents�referred�to above,�and�in�any�event�shall�have�no�responsibility�to�monitor�compliance�by�the�Parent�with�any�such request� for� delivery,� and� each� Lender� shall� be� solely� responsible� for� requesting� delivery� to� it� or maintaining�its�copies�of�such�documents. If� any�financial�materials�and�related�certificates�required�to�be�delivered�pursuant�to�Sections 5.01(a�,�(b��and/or�(c��shall�be�required�to�be�delivered�pursuant�to�the�terms�of�such�Section(s��on�a�day that�is�not�a�Business�Day,�the�required�date�for�such�delivery�shall�be�extended�to�the�next�succeeding Business�Day. SECTION�5.02 Use�of�Proceeds.��The�Parent�shall,�and�shall�cause�each�Subsidiary�to,�use�the proceeds�of�the�Term�Loans�on�or�prior�to�the�Spinoff�Date,�to�finance�certain�payments�to�Pentair�in conjunction� with� the� Spinoff� Transactions� and� to� pay� Transaction� Expenses� (it� being� understood� and agreed�that�the�proceeds�of�the�Term�Loans�may�not�be�used�for�any�purpose�other�than�as�set�forth�in�this sentence�.��The�Parent�shall,�and�shall�cause�each�Subsidiary�to,�use�the�proceeds�of�the�Revolving�Loans (a��on�or�prior�to�the�Spinoff�Date,�to�finance�certain�payments�to�Pentair�in�conjunction�with�the�Spinoff Transactions�and�to�pay�Transaction�Expenses�and�(b��thereafter,�solely�for�working�capital�needs�and�for general� corporate� purposes� (including� Permitted� Acquisitions,� permitted� share� repurchases,� capital expenditures�and�repayment�of�Debt��of�the�Parent,�each�Borrower�and�the�Subsidiaries.��Without�limiting the�foregoing,�the�Parent�shall�not,�and�shall�not�permit�any�Subsidiary�to,�use�the�proceeds�of�any�Credit Events,�directly�or�indirectly,�for�the�purpose,�whether�immediate,�incidental�or�ultimate,�of�purchasing�or carrying�any�“margin�stock��in�violation�of�Regulation�U�of�the�Board.��In�no�event�shall�the�proceeds�of the� Loans� be� utili�ed� for� any� purpose� that� would� constitute� unlawful� financial� assistance� within� the meaning�of�sections�678�or�679�of�the�UK�Companies�Act�2006�or�section�82�of�the�Irish�Companies�Act. SECTION�5.03 Compliance�with�Contractual�Obligations�and�Laws.��The�Parent�shall,�and�shall cause�each�Subsidiary�to,�comply�with�all�applicable�laws�and�regulations�of�any�Governmental�Authority having�jurisdiction�over�it�or�its�business�the�non-compliance�with�which�would�reasonably�be�expected to�have�a�Material�Adverse�Effect.��Without�limiting�the�foregoing,�each�Borrower�will�maintain�in�effect and�enforce�policies�and�procedures�designed�to�promote�and�achieve�compliance�by�such�Borrower,�its Subsidiaries� and� their� respective� directors,� officers,� employees� and� agents� with� applicable� Anti- Corruption�Laws�and�applicable�Sanctions�in�all�material�respects. SECTION�5.04 Insurance.��The�Parent�shall,�and�shall�cause�each�Subsidiary�to,�maintain,�with financially� sound� and� reputable� insurers�(as� determined� at� the� time� the� relevant� coverage� is�placed� or renewed� in� the� good� faith� judgment� of� the� Parent� or� relevant� Subsidiary�� and/or� pursuant� to� a� self- insurance�program,�insurance�with�respect�to�its�properties�and�business�against�loss�or�damage�of�the 92

kinds� customarily� insured� against� by� Persons�engaged� in�the� same� or� similar� businesses�and� covering similar�properties�in�the�same�or�similar�localities,�of�such�types,�with�such�deductibles,�covering�such risks�and�in�such�amounts�as�are�customarily�carried�under�similar�circumstances�by�such�other�Persons, except�where�the�failure�to�do�so�could�not�reasonably�be�expected�to�have�a�Material�Adverse�Effect. SECTION�5.05 Ownership�of�Borrowers.�The�Parent�shall�at�all�times�own�and�control,�directly or�indirectly,�all�of�the�equity�interests�(other�than�directors��qualifying�shares�and�other�than�as�may�be required�by�law��of�each�Borrower�(unless,�in�the�case�of�any�Borrower�other�than�the�Company,�such Borrower�and�has�ceased�to�be�a�party�hereto�pursuant�to�Section�2.23�. SECTION�5.06 Payment�of�Taxes.��The�Parent�shall,�and�shall�cause�each�Subsidiary�to,�pay�or make�provision�for�the�payment�of�all�United�States�federal�and�material�foreign,�state�and�other�taxes which�have�become�due�pursuant�to�such�returns�or�pursuant�to�any�assessment�in�respect�thereof�received by�the�Parent�or�any�Subsidiary,�except�(a��taxes�that�are�being�contested�in�good�faith�and�for�which adequate� reserves� have� been� provided� and/or� (b�� where� the� failure� to� so� pay� could� not� reasonably� be expected�to�have�a�Material�Adverse�Effect. SECTION�5.07 Swiss�Non-Bank�Rules.�Each�Swiss�Loan�Party�shall�at�all�times�comply�with�the Swiss�Twenty�Non-Bank�Rule,�to�the�extent�applicable��provided�that�a�Swiss�Loan�Party�shall�not�be�in breach� of� this� Section� 5.07� if� non-compliance� arises� solely� as� a� consequence� of� (a�� an� inaccurate representation�and�warranty�by�a�Lender�pursuant�to�Section�9.17��(b��any�assignment�or�participation�by a�Lender�to�a�Person�that�is�not�a�Swiss�Qualifying�Lender�without�the�consent�of�the�Company��or�(c� any�Lender�ceasing�to�be�a�Swiss�Qualifying�Lender�so�long�as�commencing�promptly�after�the�Company obtains�knowledge�of�such�event,�the�Company�and�such�Swiss�Loan�Party�take�all�reasonable�steps�to cause�the�number�of�creditors�of�such�Swiss�Loan�Party�relevant�under�the�Swiss�Twenty�Non-Bank�Rule to�be�not�more�than�20. SECTION�5.08 Loan�Party�Location.�The�Parent�will�cause�(i��each�Borrower�and�each�Material Subsidiary�incorporated�or�organi�ed�in�an�EU�jurisdiction�to�cause�its�centre�of�main�interest�(as�that term� is� used� in� Article� 3(1�� of� the� Insolvency� Regulation�� to� be� situated� solely� in� its� jurisdiction� of incorporation�and�not�to�have�an�establishment�(as�that�term�is�used�in�Article�2(10��of�the�Insolvency Regulation��situated�outside�its�jurisdiction�of�incorporation�or�organi�ation,�as�applicable�and�(ii��each Borrower�and�each�Material�Subsidiary�incorporated�in�England�and�Wales�to�cause�its�centre�of�main interest�(as�that�term�is�used�in�Article�3(1��of�the�Insolvency�Regulation��to�be�situated�solely�in�England and� Wales� and� not� to� have� an� establishment� (as� that� term� is� used� in� Article� 2(10�� of� the� Insolvency Regulation��situated�outside�its�jurisdiction�of�incorporation.��The�Parent�will�cause�its�centre�of�main interest� (as� that� term� is� used� in� Article� 3(1�� of� the� Insolvency� Regulation�� to� be� situated� solely� in� its jurisdiction�of�incorporation�and�not�to�have�an�establishment�(as�that�term�is�used�in�Article�2(10��of�the Insolvency�Regulation��situated�outside�its�jurisdiction�of�incorporation. SECTION�5.09 Tax� Residence.� No� Loan� Party� may� change� its� residence� for� Tax� purposes� provided�that�the�Parent�may�change�its�residence�from�time�to�time�for�Tax�purposes�from�the United�Kingdom�to�Ireland�or�from�Ireland�to�the�United�Kingdom. SECTION�5.10 Service�of�Process�Agent.��To�the�extent�that�the�Company�wishes�to�terminate the�Initial�Affiliate�Borrower�as�a�Borrower�hereunder,�the�Company�will�provide�to�the�Administrative Agent�prior�to,�or�substantially�contemporaneously�with,�such�termination�a�letter�from�the�Service�of Process� Agent� described� in� clause�(ii�� of� the� definition� of� “Service� of� Process� Agent�� (or� any� other Service� of� Process� Agent� acceptable� to� the� Administrative� Agent�,� and� such� letter� will� confirm� such 93

Lender�s� entrance� into,� participation� in,� administration� of� and� performance� of� the� Loans,� the Letters�of�Credit,�the�Commitments�and�this�Agreement��or (iv� such� other� representation,� warranty� and� covenant� as� may� be� agreed� in� writing between�the�Administrative�Agent,�in�its�sole�discretion,�and�such�Lender. (b� In� addition,� unless� sub-clause� (i�� in� the� immediately� preceding� clause� (a�� is� true� with respect�to�a�Lender�or�such�Lender�has�not�provided�another�representation,�warranty�and�covenant�as provided�in�sub-clause�(iv��in�the�immediately�preceding�clause�(a�,�such�Lender�further�(x��represents and�warrants,�as�of�the�date�such�Person�became�a�Lender�party�hereto,�to,�and�(y��covenants,�from�the date� such� Person� became� a� Lender� party� hereto� to� the� date� such� Person� ceases� being� a� Lender� party hereto,�for�the�benefit�of,�the�Administrative�Agent,�and�each�Arranger�and�their�respective�Affiliates,�and not,�for�the�avoidance�of�doubt,�to�or�for�the�benefit�of�the�Company�or�any�other�Loan�Party,�that: (i� none� of� the� Administrative� Agent,� or� any� Arranger� or� any� of� their� respective Affiliates�is�a�fiduciary�with�respect�to�the�assets�of�such�Lender�(including�in�connection�with�the reservation�or�exercise�of�any�rights�by�the�Administrative�Agent�under�this�Agreement,�any�Loan Document�or�any�documents�related�hereto�or�thereto�� (ii� the�Person�making�the�investment�decision�on�behalf�of�such�Lender�with�respect to�the�entrance�into,�participation�in,�administration�of�and�performance�of�the�Loans,�the�Letters of�Credit,�the�Commitments�and�this�Agreement�is�independent�(within�the�meaning�of�29�CFR�� 2510.3-21,� as� amended� from� time� to� time�� and� is� a� bank,� an� insurance� carrier,� an� investment adviser,� a� broker-dealer� or� other� person� that� holds,� or� has� under�management� or� control,� total assets�of�at�least�$50,000,000,�in�each�case�as�described�in�29�CFR��2510.3-21(c�(1�(i�(A�-(E�� (iii� the�Person�making�the�investment�decision�on�behalf�of�such�Lender�with�respect to�the�entrance�into,�participation�in,�administration�of�and�performance�of�the�Loans,�the�Letters of� Credit,� the� Commitments� and� this� Agreement� is� capable� of� evaluating� investment� risks independently,�both�in�general�and�with�regard�to�particular�transactions�and�investment�strategies (including�in�respect�of�the�obligations�� (iv� the�Person�making�the�investment�decision�on�behalf�of�such�Lender�with�respect to�the�entrance�into,�participation�in,�administration�of�and�performance�of�the�Loans,�the�Letters of�Credit,�the�Commitments�and�this�Agreement�is�a�fiduciary�under�ERISA�or�the�Code,�or�both, with� respect� to� the� Loans,� the� Letters� of� Credit,� the� Commitments� and� this� Agreement� and� is responsible�for�exercising�independent�judgment�in�evaluating�the�transactions�hereunder��and (v� no�fee�or�other�compensation�is�being�paid�directly�to�the�Administrative�Agent, or� any� Arranger� or� any� their� respective� Affiliates� for� investment� advice� (as� opposed� to� other services�� in� connection� with� the� Loans,� the� Letters� of� Credit,� the� Commitments� or� this Agreement. (c� The�Administrative�Agent,�and�each�Arranger�hereby�informs�the�Lenders�that�each�such Person�is�not�undertaking�to�provide�impartial�investment�advice,�or�to�give�advice�in�a�fiduciary�capacity, in�connection�with�the�transactions�contemplated�hereby,�and�that�such�Person�has�a�financial�interest�in the�transactions�contemplated�hereby�in�that�such�Person�or�an�Affiliate�thereof�(i��may�receive�interest�or other�payments�with�respect�to�the�Loans,�the�Letters�of�Credit,�the�Commitments�and�this�Agreement,�(ii� may�recogni�e�a�gain�if�it�extended�the�Loans,�the�Letters�of�Credit�or�the�Commitments�for�an�amount less�than�the�amount�being�paid�for�an�interest�in�the�Loans,�the�Letters�of�Credit�or�the�Commitments�by such�Lender�or�(iii��may�receive�fees�or�other�payments�in�connection�with�the�transactions�contemplated 109

Party�or�any�of�its�Subsidiaries�may�have�conflicting�interests�regarding�the�transactions�described�herein and�otherwise.��No�Credit�Party�will�use�confidential�information�obtained�from�the�Loan�Party�by�virtue of�the�transactions�contemplated�by�the�Loan�Documents�or�its�other�relationships�with�the�Loan�Party�in connection� with� the� performance� by�such�Credit�Party�of� services�for�other�companies,�and�no� Credit Party�will�furnish�any�such�information�to�other�companies.��Each�Loan�Party�also�acknowledges�that�no Credit� Party� has� any� obligation� to� use� in� connection� with� the� transactions� contemplated� by� the� Loan Documents,�or�to�furnish�to�such�Loan�Party�or�any�of�its�Subsidiaries,�confidential�information�obtained from�other�companies. SECTION�9.16 Acknowledgement� and� Consent� to� Bail-In� of� EEA� Financial� Institutions. Notwithstanding�anything�to�the�contrary�in�any�Loan�Document�or�in�any�other�agreement,�arrangement or�understanding�among�any�such�parties,�each�party�hereto�acknowledges�that�any�liability�of�any�EEA Financial� Institution� arising� under� any� Loan� Document� may� be� subject� to� the� Write-Down� and Conversion�Powers�of�an�EEA�Resolution�Authority�and�agrees�and�consents�to,�and�acknowledges�and agrees�to�be�bound�by: (a� the� application� of� any� Write-Down� and� Conversion� Powers� by� an� EEA� Resolution Authority�to�any�such�liabilities�arising�hereunder�which�may�be�payable�to�it�by�any�party�hereto�that�is an�EEA�Financial�Institution��and (b� the�effects�of�any�Bail-In�Action�on�any�such�liability,�including,�if�applicable: (i� a�reduction�in�full�or�in�part�or�cancellation�of�any�such�liability� (ii� a�conversion�of�all,�or�a�portion�of,�such�liability�into�shares�or�other�instruments of�ownership�in�such�EEA�Financial�Institution,�its�parent�entity,�or�a�bridge�institution�that�may be�issued�to�it�or�otherwise�conferred�on�it,�and�that�such�shares�or�other�instruments�of�ownership will�be�accepted�by�it�in�lieu�of�any�rights�with�respect�to�any�such�liability�under�this�Agreement or�any�other�Loan�Document��or (iii� the�variation�of�the�terms�of�such�liability�in�connection�with�the�exercise�of�the Write-Down�and�Conversion�Powers�of�any�EEA�Resolution�Authority. SECTION�9.17 Confirmation� of� Lender�s� Status� as� Swiss� Qualifying� Lender.� Each� Lender represents�and�warrants�to�the�Loan�Parties�that,�on�the�date�of�this�Agreement�(or,�if�later,�the�date�such Lender�becomes�a�party�hereto�,�unless�notified�in�writing�to�the�Company�and�the�Administrative�Agent prior�to�the�Effective�Date�(or�such�later�date�,�it�is�a�Swiss�Qualifying�Lender�and�has�not�entered�into�a participation�arrangement�with�respect�to�this�Agreement�with�any�Person�that�is�a�Swiss�Non-Qualifying Lender.� � Any� Person� that� shall� become� a� successor,� assign� or� Participant� with� respect� to� any� Lender pursuant� to� this� Agreement� shall� be� deemed� to� have� represented� and� warranted� that� it� is� a� Swiss Qualifying�Lender�and�has�not�entered�into�a�participation�arrangement�with�respect�to�this�Agreement with�any�Person�that�is�a�Swiss�Non-Qualifying�Lender�or,�if�not,�such�Person�accounts�as�one�single creditor�for�purposes�of�the�Swiss�Non-Bank�Rules.��Each�Lender�shall�promptly�notify�the�Company�and the�Administrative�Agent�if�for�any�reason�it�ceases�to�be�a�Swiss�Qualifying�Lender�and/or�it�enters�into�a participation�arrangement�with�respect�to�this�Agreement�with�any�Person�that�is�a�Swiss�Non-Qualifying Lender. SECTION�9.18Acknowledgement�Regarding�Supported�QFCs.��To�the�extent�that�the�Loan Documents�provide�support,�through�a�guarantee�or�otherwise,�for�Swap�Agreements�or�any�other agreement�or�instrument�that�is�a�QFC�(such�support�“QFC�Credit�Support��and�each�such�QFC�a “Supported� QFC��,� the� parties� acknowledge� and� agree� as� follows� with� respect� to� the� resolution 126

power�of�the�Federal�Deposit�Insurance�Corporation�under�the�Federal�Deposit�Insurance�Act�and Title�II�of�the�Dodd-Frank�Wall�Street�Reform�and�Consumer�Protection�Act�(together�with�the regulations� promulgated� thereunder,� the� “U.S.� Special� Resolution� Regimes�� in� respect� of� such Supported�QFC�and�QFC�Credit�Support�(with�the�provisions�below�applicable�notwithstanding that�the�Loan�Documents�and�any�Supported�QFC�may�in�fact�be�stated�to�be�governed�by�the�laws of�the�State�of�New��ork�and/or�of�the�United�States�or�any�other�state�of�the�United�States�: In�the�event�a�Covered�Entity�that�is�party�to�a�Supported�QFC�(each,�a�“Covered�Party�� becomes� subject� to� a� proceeding� under� a� U.S.� Special� Resolution� Regime,� the� transfer� of� such Supported�QFC�and�the�benefit�of�such�QFC�Credit�Support�(and�any�interest�and�obligation�in�or under�such�Supported�QFC�and�such�QFC�Credit�Support,�and�any�rights�in�property�securing such�Supported�QFC�or�such�QFC�Credit�Support��from�such�Covered�Party�will�be�effective�to�the same� extent� as� the� transfer� would� be� effective� under� the� U.S.� Special� Resolution� Regime� if� the Supported� QFC� and� such� QFC� Credit� Support� (and� any� such� interest,� obligation� and� rights� in property��were�governed�by�the�laws�of�the�United�States�or�a�state�of�the�United�States.�In�the event�a�Covered�Party�or�a�BHC�Act�Affiliate�of�a�Covered�Party�becomes�subject�to�a�proceeding under� a� U.S.� Special� Resolution� Regime,� Default� Rights� under� the� Loan� Documents� that� might otherwise�apply�to�such�Supported�QFC�or�any�QFC�Credit�Support�that�may�be�exercised�against such�Covered�Party�are�permitted�to�be�exercised�to�no�greater�extent�than�such�Default�Rights could�be�exercised�under�the�U.S.�Special�Resolution�Regime�if�the�Supported�QFC�and�the�Loan Documents�were�governed�by�the�laws�of�the�United�States�or�a�state�of�the�United�States.�Without limitation�of�the�foregoing,�it�is�understood�and�agreed�that�rights�and�remedies�of�the�parties�with respect�to�a�Defaulting�Lender�shall�in�no�event�affect�the�rights�of�any�Covered�Party�with�respect to�a�Supported�QFC�or�any�QFC�Credit�Support. ARTICLE�X. PARENT�GUARANTEE In� order� to� induce� the� Lenders� to� extend� credit� to� the� Borrowers� hereunder� or� to� any� of� the Parent�s�Subsidiaries�under�Hedging�Agreements�and�Banking�Services�Agreements,�and�for�other�good and�valuable�consideration�(the�receipt�and�sufficiency�of�which�are�hereby�acknowledged��the�Parent hereby�irrevocably�and�unconditionally�guarantees,�as�a�primary�obligor�and�not�merely�as�a�surety,�the payment�when�and�as�due,�subject�to�the�notice�provisions�contained�in�this�Article�X,�of�the�Obligations and�the�Specified�Ancillary�Obligations�(collectively,�the�“Guaranteed�Obligations��.��The�Parent�further agrees�that�the�due�and�punctual�payment�of�such�Guaranteed�Obligations�may�be�extended�or�renewed,�in whole� or� in� part,� without� notice� to� or� further� assent� from� it,� and� that� it� will� remain� bound� upon� its guarantee�hereunder�notwithstanding�any�such�extension�or�renewal�of�any�such�Guaranteed�Obligation. For�the�avoidance�of�doubt�and�notwithstanding�any�provision�hereof�to�the�contrary,�(i��the�Guaranteed Obligations� shall� in� no� event� be� broader� than� the� performance�of�the� related� Obligations� or� Specified Ancillary�Obligations�in�accordance�with�their�terms�and�(ii��nothing�contained�in�this�Article�X�shall affect� or� otherwise� impair� any� rights� (including� rights� of� setoff� or� counterclaim�� that� the� applicable Borrower� or� Subsidiary� may� have� against� any� holder� of� Guaranteed� Obligation� under� the� applicable Hedging�Agreement�and/or�Banking�Services�Agreement,�as�applicable,�by�reason�of�any�action�or�failure to�act�of�such�holder�thereunder�(including,�without�limitation,�any�breach�or�default�of�such�holder�under the�related�Hedging�Agreement�or�Banking�Services�Agreement�. The�Parent�waives�presentment�to,�demand�of�payment�from�and�protest�to�any�Subsidiary�of�any of� the� Guaranteed� Obligations,� and� also� waives,� other� than� as� set� forth� in� this� Article� X,� notice� of acceptance�of�its�obligations�and�notice�of�protest�for�nonpayment.��The�obligations�of�the�Parent�under this�Article�X�shall�not�be�affected�by:�(a��the�failure�of�the�Administrative�Agent,�any�Issuing�Bank�or 127

SCHEDULE�2.01 COMMITMENTS LENDER REVOLVING TERM�LOAN COMMITMENT COMMITMENT JPMORGAN�CHASE�BANK,�N.A. $62,231,332.36 $25,768,667.64 BANK�OF�AMERICA,�N.A. $62,231,332.36 $25,768,667.64 THEMUFG�BANK�OF�TOK�O-MITSUBISHI�UFJ, $62,231,332.36 $25,768,667.64 LTD. CITIBANK,�N.A. $62,231,332.36 $25,768,667.64 U.S.�BANK�NATIONAL�ASSOCIATION $62,231,332.36 $25,768,667.64 GOLDMAN�SACHS�BANK�USA $58,500,000.00 $0.00 WELLS�FARGO�BANK,�NATIONAL�ASSOCIATION $41,369,692.53 $17,130,307.47 HSBC�BANK�USA,�NATIONAL�ASSOCIATION $41,369,692.53 $17,130,307.47 DEUTSCHE�BANK�AG�NEW��ORK�BRANCH $58,500,000.00 $0.00 PNC�BANK,�NATIONAL�ASSOCIATION $30,408,491.95 $12,591,508.05 BANK�OF�MONTREAL,�LONDON�BRANCH $30,408,491.95 $12,591,508.05 BANK�OF�CHINA,�LOS�ANGELES�BRANCH $28,286,969.24 $11,713,030.76 AGGREGATE�COMMITMENTS �600,000,000 �200,000,000

SCHEDULE�2.05 SWINGLINE�SUBLIMITS LENDER SWINGLINE SUBLIMIT JPMORGAN�CHASE�BANK,�N.A. $15,000,000 BANK�OF�AMERICA,�N.A. $15,000,000 THEMUFG�BANK�OF�TOK�O-MITSUBISHI�UFJ,�LTD. $15,000,000 CITIBANK,�N.A. $15,000,000 U.S.�BANK�NATIONAL�ASSOCIATION $15,000,000

EXHIBIT�A FORM�OF�ASSIGNMENT�AND�ASSUMPTION This�Assignment�and�Assumption�(the�“Assignment�and�Assumption��is�dated�as�of�the�Effective Date�set�forth�below�and�is�entered�into�by�and�between�[Insert name of Assignor��(the�“Assignor��and [Insert name of Assignee��(the�“Assignee��.��Capitali�ed�terms�used�but�not�defined�herein�shall�have�the meanings�given�to�them�in�the�Credit�Agreement�identified�below�(as�amended,�restated,�supplemented�or otherwise� modified� from� time� to� time,� the� “Credit�Agreement��,� receipt�of� a� copy� of�which� is� hereby acknowledged�by�the�Assignee.��The�Standard�Terms�and�Conditions�set�forth�in�Annex�1�attached�hereto are� hereby� agreed� to� and� incorporated� herein� by� reference� and� made� a� part� of� this� Assignment� and Assumption�as�if�set�forth�herein�in�full. For�an�agreed�consideration,�the�Assignor�hereby�irrevocably�sells�and�assigns�to�the�Assignee, and� the� Assignee� hereby� irrevocably� purchases� and� assumes� from� the� Assignor,� subject� to� and� in accordance�with�the�Standard�Terms�and�Conditions�and�the�Credit�Agreement,�as�of�the�Effective�Date inserted� by� the� Administrative� Agent� as� contemplated� below� (i�� all� of� the� Assignor�s� rights� and obligations� in� its� capacity� as� a� Lender� under� the� Credit� Agreement� and� any� other� documents� or instruments� delivered� pursuant� thereto� to� the� extent� related� to� the� amount� and� percentage� interest identified�below�of�all�of�such�outstanding�rights�and�obligations�of�the�Assignor�under�the�respective facilities� identified� below� (including� any� letters� of� credit,� guarantees,� and� swingline� loans� included�in such� facilities�� and� (ii�� to� the� extent� permitted� to� be� assigned� under� applicable� law,� all� claims,� suits, causes� of�action�and� any� other� right�of� the�Assignor�(in�its�capacity�as� a� Lender�� against�any�Person, whether� known� or� unknown,� arising� under� or� in� connection� with� the� Credit� Agreement,� any� other documents�or�instruments�delivered�pursuant�thereto�or�the�loan�transactions�governed�thereby�or�in�any way�based�on�or�related�to�any�of�the�foregoing,�including�contract�claims,�tort�claims,�malpractice�claims, statutory�claims� and� all� other�claims�at�law�or�in� equity�related�to� the� rights�and�obligations�sold� and assigned�pursuant�to�clause�(i��above�(the�rights�and�obligations�sold�and�assigned�pursuant�to�clauses�(i� and�(ii��above�being�referred�to�herein�collectively�as�the�“Assigned�Interest��.��Such�sale�and�assignment is�without�recourse�to�the�Assignor�and,�except�as�expressly�provided�in�this�Assignment�and�Assumption, without�representation�or�warranty�by�the�Assignor. 1. Assignor: 2. Assignee: [and�is�an�Affiliate/Approved�Fund�of�[identify�Lender�1� 3. Borrowers: nVent� Finance� S.�� r.l.� and� Pentair� Technical� ProductsHoffman Schroff�Holdings,�Inc. 4. Administrative�Agent: JPMorgan� Chase� Bank,� N.A.,� as� the� administrative� agent� under� the Credit�Agreement 5. Credit�Agreement: The�Credit�Agreement�dated�as�of�March�23,�2018�among�nVent�Finance S.�� r.l.,� nVent� Electric� plc,� Pentair� Technical� ProductsHoffman Schroff�Holdings,�Inc.,�the�other�Affiliate�Borrowers�from�time�to�time parties�thereto,�the�Lenders�parties�thereto,�JPMorgan�Chase�Bank,�N.A., as�Administrative�Agent,�and�the�other�agents�parties�thereto 6. Assigned�Interest: 1�Select�as�applicable.

EXHIBIT�C-1 FORM�OF�INCREASING�LENDER�SUPPLEMENT INCREASING� LENDER� SUPPLEMENT,� dated� __________,� 20___� (this� “Supplement��,� by and� among� each� of� the� signatories� hereto,� to� the� Credit� Agreement,� dated� as� of� March� 23,� 2018� (as amended,� restated,� supplemented� or� otherwise� modified� from� time� to� time,� the� “Credit� Agreement��, among�nVent�Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having�its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the Luxembourg� Trade� and� Companies� Register� (R.C.S. Luxembourg�� under� number� B� 219846� (the “Company��,�nVent�Electric�plc�(the�“Parent��,�Pentair�Technical�ProductsHoffman�Schroff�Holdings, Inc.�(the�“Initial�Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the Lenders� party�thereto�and�JPMorgan� Chase�Bank,�N.A.,�as�administrative�agent�(in�such�capacity,�the “Administrative�Agent��. W�I�T�N�E�S�S�E�T�H WHEREAS,� pursuant� to� Section�2.20� of� the� Credit� Agreement,� the� Company� has� the� right, subject�to�the�terms�and�conditions�thereof,�to�effectuate�from�time�to�time�an�increase�in�the�aggregate Revolving� Commitments� and/or� one� or� more� tranches� of� Incremental� Term� Loans� under� the� Credit Agreement� by� requesting� one� or� more� Lenders� to� increase� the� amount� of� its� Revolving� Commitment and/or�to�participate�in�such�a�tranche� WHEREAS,� the� Company� has� given� notice� to� the� Administrative� Agent� of� its� intention� to [increase�the�aggregate�Revolving�Commitments��[and��[enter�into�a�tranche�of�Incremental�Term�Loans� pursuant�to�such�Section�2.20��and WHEREAS,� pursuant� to� Section�2.20� of� the� Credit� Agreement,� the� undersigned� Increasing Lender�now�desires�to�[increase�the�amount�of�its�Revolving�Commitment��[and��[participate�in�a�tranche of�Incremental�Term�Loans��under�the�Credit�Agreement�by�executing�and�delivering�to�the�Company�and the�Administrative�Agent�this�Supplement� NOW,�THEREFORE,�each�of�the�parties�hereto�hereby�agrees�as�follows: 1. The� undersigned� Increasing� Lender� agrees,� subject� to� the� terms� and� conditions� of� the Credit�Agreement,�that�on�the�date�of�this�Supplement�it�shall�[have�its�Revolving�Commitment�increased by�$[__________�,�thereby�making�the�aggregate�amount�of�its�total�Revolving�Commitments�equal�to $[__________��[and��[participate�in�a�tranche�of�Incremental�Term�Loans�with�a�commitment�amount equal�to�$[__________��with�respect�thereto�. [[__�.��The�undersigned�Increasing�Lender�confirms�for�the�benefit�of�the�Administrative�Agent and�the�Loan�Parties�but�without�liability�to�any�Loan�Party,�that�it�is�[not�a�UK�Qualifying�Lender��[a�UK Qualifying�Lender�(other�than�a�UK�Treaty�Lender��[(a�UK�Treaty�Lender�.�10 [[__�.� � The� undersigned� Increasing� Lender� confirms� that� the� person� beneficially� entitled� to interest�payable�to�that�Increasing�Lender�in�respect�of�an�advance�under�a�Loan�Document�is�either�(a��a company� resident� in� the� United�Kingdom�for� United� Kingdom� tax� purposes� or� (b��a� partnership� each member�of�which�is�(i��a�company�so�resident�in�the�United�Kingdom�or�(ii��a�company�not�so�resident�in the�United�Kingdom�which�carries�on�a�trade�in�the�United�Kingdom�through�a�permanent�establishment and�which�brings�into�account�in�computing�its�chargeable�profits�(within�the�meaning�of�section�19�of�the 10�Delete�as�applicable��each�Increasing�Lender�is�required�to�confirm�which�of�these�three�categories�it�falls�within.

EXHIBIT�C-2 FORM�OF�AUGMENTING�LENDER�SUPPLEMENT AUGMENTING�LENDER�SUPPLEMENT,�dated�__________,�20___�(this�“Supplement��,�by and� among� each� of� the� signatories� hereto,� to� the� Credit� Agreement,� dated� as� of� March� 23,� 2018� (as amended,� restated,� supplemented� or� otherwise� modified� from� time� to� time,� the� “Credit� Agreement��, among�nVent�Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having�its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the Luxembourg� Trade� and� Companies� Register� (R.C.S. Luxembourg�� under� number� B� 219846� (the “Company��,�nVent�Electric�plc�(the�“Parent��,�Pentair�Technical�ProductsHoffman�Schroff�Holdings, Inc.�(the�“Initial�Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the Lenders� party�thereto�and�JPMorgan� Chase�Bank,�N.A.,�as�administrative�agent�(in�such�capacity,�the “Administrative�Agent��. W�I�T�N�E�S�S�E�T�H WHEREAS,� the� Credit� Agreement� provides� in� Section�2.20� thereof� that� any� bank,� financial institution� or� other� entity� may� [extend� Revolving� Commitments�� [and�� [participate� in� tranches� of Incremental�Term�Loans��under�the�Credit�Agreement�subject�to�the�approval�of�the�Company�and�the Administrative� Agent,� by� executing� and� delivering� to� the� Company� and� the� Administrative� Agent� a supplement�to�the�Credit�Agreement�in�substantially�the�form�of�this�Supplement��and WHEREAS,� the� undersigned� Augmenting� Lender� was� not� an� original� party� to� the� Credit Agreement�but�now�desires�to�become�a�party�thereto� NOW,�THEREFORE,�each�of�the�parties�hereto�hereby�agrees�as�follows: 1.� � The� undersigned� Augmenting� Lender� agrees� to� be� bound� by� the� provisions� of� the� Credit Agreement�and�agrees�that�it�shall,�on�the�date�of�this�Supplement,�become�a�Lender�for�all�purposes�of the�Credit�Agreement�to�the�same�extent�as�if�originally�a�party�thereto,�with�a�[Revolving�Commitment of�$[__________��[and��[a�commitment�with�respect�to�Incremental�Term�Loans�of�$[__________��. [[__�.��The�undersigned�Augmenting�Lender�confirms�for�the�benefit�of�the�Administrative�Agent and�the�Loan�Parties�but�without�liability�to�any�Loan�Party,�that�it�is�[not�a�UK�Qualifying�Lender��[a�UK Qualifying�Lender�(other�than�a�UK�Treaty�Lender��[(a�UK�Treaty�Lender�.�14 [[__�.� � The� undersigned� Augmenting� Lender� confirms� that� the� person� beneficially� entitled� to interest�payable�to�that�Augmenting�Lender�in�respect�of�an�advance�under�a�Loan�Document�is�either�(a� a�company�resident�in�the�United�Kingdom�for�United�Kingdom�tax�purposes�or�(b��a�partnership�each member�of�which�is�(i��a�company�so�resident�in�the�United�Kingdom�or�(ii��a�company�not�so�resident�in the�United�Kingdom�which�carries�on�a�trade�in�the�United�Kingdom�through�a�permanent�establishment and�which�brings�into�account�in�computing�its�chargeable�profits�(within�the�meaning�of�section�19�of�the UK�CTA�2009��the�whole�of�any�share�of�interest�payable�in�respect�of�that�advance�that�falls�to�it�by reason�of�Part�17�of�the�UK�CTA�2009�or�(c��a�company�not�so�resident�in�the�United�Kingdom�which carries� on� a� trade� in� the� United� Kingdom� through� a� permanent� establishment� and� which� brings� into 14�Delete�as�applicable��each�Augmenting�Lender�is�required�to�confirm�which�of�these�three�categories�it�falls within.

EXHIBIT�D-1 [FORM�OF� REVOLVING�CREDIT�NOTE March�23,�2018 FOR� VALUE� RECEIVED,� the� undersigned,� [NVENT� FINANCE� S.�� R.L.,� a� Luxembourg private� limited� liability� company� (Société à responsabilité limitée�,� having� its� registered� office� at� 26, boulevard� Royal,� L-2449� Luxembourg� and� registered� with� the� Luxembourg� Trade� and� Companies Register� (R.C.S. Luxembourg�� under� number� B� 219846�[PENTAIR� TECHNICAL PRODUCTSHOFFMAN�SCHROFF�HOLDINGS,�INC.��(the�“Borrower��,�HEREB��PROMISES�TO PA��TO�[LENDER��(the�“Lender��the�outstanding�principal�balance�of�the�Lender�s�Revolving�Loans made�to�the�Borrower,�together�with�interest�thereon,�at�the�rate�or�rates,�in�the�amounts�and�at�the�time�or times� set� forth� in� the� Credit� Agreement� (as� the� same� may� be� amended,� supplemented� or� otherwise modified�from�time�to�time,�the�“Credit�Agreement��,�dated�as�of�March�23,�2018,�by�and�among�nVent Finance�S.��r.l.,�nVent�Electric�plc,�Pentair�Technical�ProductsHoffman�Schroff�Holdings,�Inc.,�the other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�Lenders�party�thereto,�the�Documentation Agents,�the�Syndication�Agents�and�JPMorgan�Chase�Bank,�N.A.,�as�the�Administrative�Agent,�in�each case�at�such�place�as�the�Administrative�Agent�may�specify�from�time�to�time,�in�lawful�money�of�the United�States�in�immediately�available�funds. Capitali�ed�terms�used�herein�which�are�not�otherwise�defined�herein�shall�have�the�respective meanings�ascribed�thereto�in�the�Credit�Agreement. The�Revolving�Loans�evidenced�by�this�Note�are�prepayable�in�the�amounts,�and�on�the�dates,�set forth�in�the�Credit�Agreement.��This�Note�is�one�of�the�Notes�under,�and�as�such�term�is�defined�in,�the Credit�Agreement,�and�is�subject�to,�and�should�be�construed�in�accordance�with,�the�provisions�thereof, and�is�entitled�to�the�benefits�set�forth�in�the�Loan�Documents. The�Lender�is�hereby�authori�ed�to�record�on�the�schedule�annexed�hereto�and�any�continuation sheets�which�the�Lender�may�attach�thereto�(a��the�date�and�amount�of�each�Revolving�Loan�made�by such�Lender,�(b��the�character�of�each�Revolving�Loan�as�one�or�more�ABR�Borrowings,�one�or�more Eurocurrency� Borrowings,� or� a� combination� thereof,� (c�� the� Interest� Period� and� Adjusted� LIBO� Rate applicable�to�each�Eurocurrency�Borrowing,�and�(d��the�date�and�amount�of�each�conversion�of,�and�each payment�or�prepayment�of�principal�of,�each�Revolving�Loan.��No�failure�to�so�record�nor�any�error�in�so recording�shall�affect�the�obligation�of�the�Borrower�to�repay�the�Revolving�Loans,�together�with�interest thereon,� as� provided�in�the� Credit�Agreement,�and�the�outstanding�principal�balance�of� the� Revolving Loans�as�set�forth�in�such�schedule�shall�be�prima�facie�evidence�of�the�existence�and�amounts�of�the obligations�recorded�therein. Except�as�specifically�otherwise�provided�in�the�Credit�Agreement,�the�Borrower�hereby�waives presentment,�demand,�notice�of�dishonor,�protest,�notice�of�protest�and�all�other�demands,�protests�and notices�in�connection�with�the�execution,�delivery,�performance,�collection�and�enforcement�of�this�Note. THIS�NOTE�SHALL�BE�CONSTRUED�IN�ACCORDANCE�WITH�AND�GOVERNED�B� THE�LAW�OF�THE�STATE�OF�NEW��ORK. [NVENT�FINANCE�S.��R.L.� [PENTAIR�TECHNICAL�PRODUCTS�HOLDINGS, HOFFMAN�SCHROFF�HOLDINGS,�INC.�

EXHIBIT�D-2 [FORM�OF� TERM�LOAN�NOTE March�23,�2018 FOR� VALUE� RECEIVED,� the� undersigned,� NVENT� FINANCE� S.�� R.L.,� a� Luxembourg private� limited� liability� company� (Société à responsabilité limitée�,� having� its� registered� office� at� 26, boulevard� Royal,� L-2449� Luxembourg� and� registered� with� the� Luxembourg� Trade� and� Companies Register� (R.C.S. Luxembourg�� under� number� B� 219846� (the� “Borrower��,� HEREB�� PROMISES� TO PA��TO�[LENDER��(the�“Lender��the�outstanding�principal�balance�of�the�Lender�s�Term�Loans�made to�the�Borrower,�together�with�interest�thereon,�at�the�rate�or�rates,�in�the�amounts�and�at�the�time�or�times set�forth�in�the�Credit�Agreement�(as�the�same�may�be�amended,�supplemented�or�otherwise�modified from�time�to�time,�the�“Credit�Agreement��,�dated�as�of�March�23,�2018,�by�and�among�nVent�Finance S.�� r.l.,� nVent� Electric� plc,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.,� the� other Affiliate�Borrowers�from�time�to�time�party�thereto,�the�Lenders�party�thereto,�the�Documentation�Agents, the�Syndication�Agents�and�JPMorgan�Chase�Bank,�N.A.,�as�the�Administrative�Agent,�in�each�case�at such�place�as�the�Administrative�Agent�may�specify�from�time�to�time,�in�lawful�money�of�the�United States�in�immediately�available�funds. Capitali�ed�terms�used�herein�which�are�not�otherwise�defined�herein�shall�have�the�respective meanings�ascribed�thereto�in�the�Credit�Agreement. The�Term�Loans�evidenced�by�this�Note�are�prepayable�in�the�amounts,�and�on�the�dates,�set�forth in�the�Credit�Agreement.��This�Note�is�one�of�the�Notes�under,�and�as�such�term�is�defined�in,�the�Credit Agreement,�and�is�subject�to,�and�should�be�construed�in�accordance�with,�the�provisions�thereof,�and�is entitled�to�the�benefits�set�forth�in�the�Loan�Documents. The�Lender�is�hereby�authori�ed�to�record�on�the�schedule�annexed�hereto�and�any�continuation sheets�which�the�Lender�may�attach�thereto�(a��the�date�and�amount�of�each�Term�Loan�made�by�such Lender,�(b��the�character�of�each�Term�Loan�as�one�or�more�ABR�Borrowings,�one�or�more�Eurocurrency Borrowings,�or�a�combination�thereof,�(c��the�Interest�Period�and�Adjusted�LIBO�Rate�applicable�to�each Eurocurrency� Borrowing,� and� (d�� the� date� and� amount� of� each� conversion� of,� and� each� payment� or prepayment�of�principal�of,�each�Term�Loan.��No�failure�to�so�record�nor�any�error�in�so�recording�shall affect�the�obligation�of�the�Borrower�to�repay�the�Term�Loans,�together�with�interest�thereon,�as�provided in�the�Credit�Agreement,�and�the�outstanding�principal�balance�of�the�Term�Loans�as�set�forth�in�such schedule�shall�be�prima�facie�evidence�of�the�existence�and�amounts�of�the�obligations�recorded�therein. Except�as�specifically�otherwise�provided�in�the�Credit�Agreement,�the�Borrower�hereby�waives presentment,�demand,�notice�of�dishonor,�protest,�notice�of�protest�and�all�other�demands,�protests�and notices�in�connection�with�the�execution,�delivery,�performance,�collection�and�enforcement�of�this�Note. THIS�NOTE�SHALL�BE�CONSTRUED�IN�ACCORDANCE�WITH�AND�GOVERNED�B� THE�LAW�OF�THE�STATE�OF�NEW��ORK. NVENT�FINANCE�S.��R.L. By: Name: Title:

EXHIBIT�F-1 [FORM�OF� AFFILIATE�BORROWING�AGREEMENT AFFILIATE�BORROWING�AGREEMENT�dated�as�of�[_____�,�among�nVent�Finance�S.��r.l.,�a Luxembourg� private� limited� liability� company� (Société à responsabilité limitée�,� having� its� registered office� at� 26,� boulevard� Royal,� L-2449� Luxembourg� and� registered� with� the� Luxembourg� Trade� and Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent�Electric�plc, an�Irish�public�limited�company�(the�“Parent��,�[Name�of�Affiliate�Borrower�,�a�[__________��(the�“New Affiliate� Borrower��,� and� JPMorgan� Chase� Bank,� N.A.� as� Administrative� Agent� (the� “Administrative Agent��. Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�the�Company, the� Parent,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial� Affiliate Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�Lenders�from�time�to�time party�thereto�and�JPMorgan�Chase�Bank,�N.A.�as�Administrative�Agent.��Capitali�ed�terms�used�herein but�not�otherwise�defined�herein�shall�have�the�meanings�assigned�to�such�terms�in�the�Credit�Agreement. Under� the� Credit� Agreement,� the� Lenders� have� agreed,� upon� the� terms� and� subject� to� the� conditions therein� set� forth,� to� make� Loans� to� certain� Affiliate� Borrowers� (collectively� with� the� Company,� the “Borrowers��,�and�the�Company�and�the�New�Affiliate�Borrower�desire�that�the�New�Affiliate�Borrower become�an�Affiliate�Borrower.��In�addition,�the�New�Affiliate�Borrower�hereby�authori�es�the�Company to� act� on� its� behalf� as� and� to� the� extent� provided� for� in� Article� II� of� the� Credit� Agreement. �Notwithstanding�the�preceding�sentence,� the�New�Affiliate�Borrower�hereby�designates�the�following officers�as� being� authori�ed� to�request�Borrowings�under� the�Credit�Agreement�on� behalf�of� the� New Affiliate�Borrower�and�sign�this�Affiliate�Borrowing�Agreement�and�the�other�Loan�Documents�to�which the�New�Affiliate�Borrower�is,�or�may�from�time�to�time�become,�a�party:�[______________�.� Each�of�the�Company,�the�Parent�and�the�New�Affiliate�Borrower�represents�and�warrants�that�the representations�and�warranties�in�the�Credit�Agreement�relating�to�the�New�Affiliate�Borrower�and�this Agreement�(other�than�the�representations�contained�in�Sections�3.04(b��and�3.05��are�true�and�correct�in all� material� respects� (provided� that� any� representation� or� warranty� that� is� qualified� by� materiality� or Material�Adverse�Effect�shall�be�true�and�correct�in�all�respects��on�and�as�of�the�date�hereof�(or,�if�any such�representation�or�warranty�is�expressly�stated�to�have�been�made�as�of�a�specific�date,�as�of�such specific� date�.� � [INSERT� OTHER� PROVISIONS� REASONABL�� REQUESTED� B� ADMINISTRATIVE�AGENT�OR�ITS�COUNSELS��The�Parent�agrees�that�the�guarantee�of�the�Parent contained�in�the�Credit�Agreement�will�apply�to�the�Obligations�of�the�New�Affiliate�Borrower.��Upon execution�of�this�Agreement�by�each�of�the�Company,�the�Parent�and�the�New�Affiliate�Borrower�and�the Administrative�Agent,�the�New�Borrowing�Subsidiary�shall�be�a�party�to�the�Credit�Agreement�and�shall constitute�an�“Affiliate�Borrower��for�all�purposes�thereof,�and�the�New�Affiliate�Borrower�hereby�agrees to�be�bound�by�all�provisions�of�the�Credit�Agreement. This�Agreement�shall�be�governed�by�and�construed�in�accordance�with�the�laws�of�the�State�of New��ork.

EXHIBIT�F-2 [FORM�OF� AFFILIATE�BORROWER�TERMINATION JPMorgan�Chase�Bank,�N.A. as�Administrative�Agent for�the�Lenders�referred�to�below [__________� [__________� Attention:��[__________� [Date� Ladies�and�Gentlemen: The�undersigned,�nVent�Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having�its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and registered�with�the�Luxembourg�Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B 219846� (the� “Company��,� refers� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as� amended, supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�the�Company, nVent� Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the “Initial�Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�Lenders from�time�to�time�party�thereto�and�JPMorgan�Chase�Bank,�N.A.�as�Administrative�Agent.��Capitali�ed terms�used�and�not�otherwise�defined�herein�shall�have�the�meanings�assigned�to�such�terms�in�the�Credit Agreement. The� Company� hereby� terminates� the� status� of� [______________�� (the� “Terminated� Affiliate Borrower��as�an�Affiliate�Borrower�under�the�Credit�Agreement.��[The�Company�represents�and�warrants that�no�Loans�made�to�the�Terminated�Affiliate�Borrower�are�outstanding�as�of�the�date�hereof�and�that�all amounts� payable� by� the� Terminated� Affiliate� Borrower� in� respect� of� interest� and/or� fees� (and,� to� the extent�notified�by�the�Administrative�Agent�or�any�Lender,�any�other�amounts�payable�under�the�Credit Agreement��pursuant�to�the�Credit�Agreement�have�been�paid�in�full�on�or�prior�to�the�date�hereof.��[The Company� acknowledges� that� the� Terminated� Affiliate� Borrower�shall� continue� to� be� a� Borrower� until such� time� as� all� Loans� made� to� the� Terminated� Affiliate� Borrower� shall� have� been� prepaid� and� all amounts� payable� by� the� Terminated� Affiliate� Borrower� in� respect� of� interest� and/or� fees� (and,� to� the extent�notified�by�the�Administrative�Agent�or�any�Lender,�any�other�amounts�payable�by�the�Terminated Affiliate�Borrower�under�the�Credit�Agreement��pursuant�to�the�Credit�Agreement�shall�have�been�paid�in full,�provided�that�the�Terminated�Affiliate�Borrower�shall�not�have�the�right�to�make�further�Borrowings under�the�Credit�Agreement.� [Signature�Page�Follows�

EXHIBIT�G-1 FORM�OF�BORROWING�REQUEST JPMorgan�Chase�Bank,�N.A., as�Administrative�Agent for�the�Lenders�referred�to�below [10�South�Dearborn Chicago,�Illinois�60603 Attention:�[__________� Facsimile:�[__________��19 With�a�copy�to: [__________� [__________� Attention:�[__________� Facsimile:�[__________� Re:��nVent�Finance�S.��r.l. [Date� Ladies�and�Gentlemen: Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�nVent Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from time�to�time�parties�thereto�as�Lenders�(the�“Lenders��and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as Administrative�Agent�for�itself�and�the�other�Lenders�(the�“Administrative�Agent��.��Capitali�ed�terms used�but�not�defined�herein�shall�have�the�meanings�assigned�to�such�terms�in�the�Credit�Agreement.��The [undersigned�Borrower�[Company,�on�behalf�of�[Affiliate�Borrower�,��hereby�gives�you�notice�pursuant to�Section�2.03�of�the�Credit�Agreement�that�it�requests�a�Borrowing�under�the�Credit�Agreement,�and�in that�connection�the�[undersigned�Borrower�[Company,�on�behalf�of�[Affiliate�Borrower�,��specifies�the following�information�with�respect�to�such�Borrowing�requested�hereby: 1. Name�of�Borrower:��__________ 2. The�requested�Borrowing�is�a�[Revolving�[Term�Loan��Borrowing 3. Aggregate�principal�amount�of�Borrowing:20��__________ 19� If� request� is� in� respect� of� Revolving� Loans� in� a� Foreign� Currency� or� a� Designated� Loan,� please� replace� this address�with�the�London�address�from�Section�9.01(a�(ii�. 20�Not�less�than�applicable�amounts�specified�in�Section�2.02(c�.

EXHIBIT�G-2 FORM�OF�INTEREST�ELECTION�REQUEST JPMorgan�Chase�Bank,�N.A., as�Administrative�Agent for�the�Lenders�referred�to�below [10�South�Dearborn Chicago,�Illinois�60603 Attention:�[_______� Facsimile:�([__��[__�-[_____��23 Re:��nVent�Finance�S.��r.l. [Date� Ladies�and�Gentlemen: Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�nVent Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from time�to�time�parties�thereto�as�Lenders�(the�“Lenders��and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as Administrative�Agent�for�itself�and�the�other�Lenders�(the�“Administrative�Agent��.��Capitali�ed�terms used�but�not�defined�herein�shall�have�the�meanings�assigned�to�such�terms�in�the�Credit�Agreement.��The [undersigned�Borrower�[Company,�on�behalf�of�[Affiliate�Borrower�,��hereby�gives�you�notice�pursuant to�Section�2.08�of�the�Credit�Agreement�that�it�requests�to�convert�an�existing�Borrowing�under�the�Credit Agreement,� and� in� that� connection� the� [undersigned� Borrower�[Company,� on� behalf� of� [Affiliate Borrower�,��specifies�the�following�information�with�respect�to�such�conversion�requested�hereby: 1. List� Borrower,� date,� Type,� Class,� principal� amount,� Agreed� Currency� and� Interest� Period� (if applicable��of�existing�Borrowing:��_________ 2. Aggregate�principal�amount�of�resulting�Borrowing:��_________ 3. Effective�date�of�interest�election�(which�shall�be�a�Business�Day�:��_________ 4. Type�of�Borrowing�(ABR�or�Eurocurrency�:��_________ 5. Interest�Period�and�the�last�day�thereof�(if�a�Eurocurrency�Borrowing�:24��_________ 6. Agreed�Currency:��_______________ 23� If� request� is� in� respect� of� Revolving� Loans� in� a� Foreign� Currency� or� a� Designated� Loan,� please� replace� this address�with�the�London�address�from�Section�9.01(a�(ii�. 24�Which�must�comply�with�the�definition�of�“Interest�Period��and�end�not�later�than�the�applicable�Maturity�Date.

EXHIBIT�H-1 [FORM�OF� U.S.�TAX�COMPLIANCE�CERTIFICATE (For�A�Foreign�Lender�That,�For�U.S.�Federal�Income�Tax�Purposes,�Is�Neither�Treated�As�A�Partnership Nor�Treated�As�A�Disregarded�Entity�That�Is�Owned�By�A�Partnership� Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�nVent Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from time�to�time�parties�thereto�as�Lenders�and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as�Administrative Agent�for�itself�and�the�other�Lenders�(the�“Administrative�Agent��. Pursuant� to� the� provisions� of� Section� 2.17� of� the� Credit� Agreement,� the� undersigned� hereby certifies� that� (i�� it� is� the� sole� record� and� beneficial� owner� of� the� Loan(s�� (as� well� as� any� Note(s� evidencing�such�Loan(s��in�respect�of�which�it�is�providing�this�certificate,�(ii��it�(or,�in�the�event�that�it�is a�Disregarded�Entity,�the�Person�that�is�treated�for�U.S.�federal�income�tax�purposes�as�being�the�sole owner�of�the�undersigned��is�(a��not�a�bank�within�the�meaning�of�Section�881(c�(3�(A��of�the�Code,�(b� not�a�ten�percent�shareholder�of�any�applicable�Borrower�within�the�meaning�of�Section�871(h�(3�(B��of the�Code�and�(c��not�a�controlled�foreign�corporation�related�to�any�applicable�Borrower�as�described�in Section�881(c�(3�(C��of�the�Code. The� undersigned� has� furnished� the� Administrative� Agent� and� applicable� Borrower� with� a certificate�of� the� non-U.S.� person� status�of� the�undersigned�(or,�in� the� event� that�the�undersigned� is�a Disregarded�Entity,�the�Person�that�is�treated�for�U.S.�federal�income�tax�purposes�as�being�the�sole�owner of�the�undersigned��on�IRS�Form�W-8BEN�or�IRS�Form�W-8BEN-E.��By�executing�this�certificate,�the undersigned�agrees�that�(1��if�the�information�provided�on�this�certificate�changes,�the�undersigned�shall promptly�so�inform�the�Borrowers�and�the�Administrative�Agent�and�(2��the�undersigned�shall�have�at�all times� furnished� the� Borrowers� and� the� Administrative� Agent� with�a� properly� completed� and� currently effective�certificate�in�either�the�calendar�year�in�which�each�payment�is�to�be�made�to�the�undersigned,�or in�either�of�the�two�calendar�years�preceding�such�payments. Unless�otherwise�defined�herein,�terms�defined�in� the�Credit�Agreement�and�used�herein�shall have�the�meanings�given�to�them�in�the�Credit�Agreement. [NAME�OF�LENDER� By:______________________________________ Name: Title: Date:��__________,�20[__�

EXHIBIT�H-2 [FORM�OF� U.S.�TAX�COMPLIANCE�CERTIFICATE (For�A�Foreign�Participant�That,�For�U.S.�Federal�Income�Tax�Purposes,�Is�Neither�Treated�As�A Partnership�Nor�Treated�As�A�Disregarded�Entity�That�Is�Owned�By�A�Partnership� Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�nVent Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from time�to�time�parties�thereto�as�Lenders�and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as�Administrative Agent�for�itself�and�the�other�Lenders�(the�“Administrative�Agent��. Pursuant� to� the� provisions� of� Section� 2.17� of� the� Credit� Agreement,� the� undersigned� hereby certifies�that�(i��it�is�the�sole�record�and�beneficial�owner�of�the�participation�in�respect�of�which�it�is providing�this�certificate,�(ii��it�(or,�in�the�event�that�it�is�a�Disregarded�Entity,�the�Person�that�is�treated for�U.S.�federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��is�(a��not�a�bank�within the� meaning�of� Section� 881(c�(3�(A�� of�the� Code,� (b��not�a� ten� percent� shareholder�of� any�applicable Borrower� within� the� meaning� of� Section� 871(h�(3�(B�� of� the� Code� and� (c�� not� a� controlled� foreign corporation�related�to�any�applicable�Borrower�as�described�in�Section�881(c�(3�(C��of�the�Code. The�undersigned�has�furnished�its�participating�Lender�with�a�certificate�of�the�non-U.S.�person status�of�the�undersigned�(or,�in�the�event�that�the�undersigned�is�a�Disregarded�Entity,�the�Person�that�is treated�for�U.S.�federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��on�IRS�Form�W- 8BEN� or� IRS� Form�W-8BEN-E.� � By� executing� this� certificate,� the� undersigned� agrees� that� (1�� if� the information�provided�on�this�certificate�changes,�the�undersigned�shall�promptly�so�inform�such�Lender�in writing,�and�(2��the�undersigned�shall�have�at�all�times�furnished�such�Lender�with�a�properly�completed and�currently�effective�certificate�in�either�the�calendar�year�in�which�each�payment�is�to�be�made�to�the undersigned,�or�in�either�of�the�two�calendar�years�preceding�such�payments. Unless�otherwise�defined�herein,�terms�defined�in� the�Credit�Agreement�and�used�herein�shall have�the�meanings�given�to�them�in�the�Credit�Agreement. [NAME�OF�PARTICIPANT� By:______________________________________ Name: Title: Date:��__________,�20[__�

EXHIBIT�H-3 [FORM�OF� U.S.�TAX�COMPLIANCE�CERTIFICATE (For�A�Foreign�Participant�That,�For�U.S.�Federal�Income�Tax�Purposes,�Is�Either�Treated�As�A Partnership�Or�Treated�As�A�Disregarded�Entity�That�Is�Owned�By�A�Partnership� Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�nVent Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from time�to�time�parties�thereto�as�Lenders�and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as�Administrative Agent�for�itself�and�the�other�Lenders�(the�“Administrative�Agent��. Pursuant� to� the� provisions� of� Section� 2.17� of� the� Credit� Agreement,� the� undersigned� hereby certifies�that�(i��it�is�the�sole�record�owner�of�the�participation�in�respect�of�which�it�is�providing�this certificate,�(ii��it�is�the�sole�beneficial�owner�of�such�participation�for�purposes�other�than�U.S.�federal income�tax�purposes,�(iii��it�(or,�in�the�event�that�it�is�a�Disregarded�Entity,�the�Person�that�is�treated�for U.S.�federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��is�not�a�bank�extending credit�pursuant�to�a�loan�agreement�entered�into�in�the�ordinary�course�of�its�trade�or�business�within�the meaning�of�Section�881(c�(3�(A��of�the�Code,�and�(iv��none�of�the�members�of�the�undersigned�(or,�in�the event�that�the�undersigned�is�a�Disregarded�Entity,�none�of�the�members�of�the�Person�that�is�treated�for U.S.�federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��is�(a��a�bank�extending credit�pursuant�to�a�loan�agreement�entered�into�in�the�ordinary�course�of�its�trade�or�business�within�the meaning�of�Section�881(c�(3�(A��of�the�Code,�(b��a�ten�percent�shareholder�of�any�applicable�Borrower within�the�meaning�of�Section�871(h�(3�(B��of�the�Code,�or�(c��a�controlled�foreign�corporation�related�to any�applicable�Borrower�as�described�in�Section�881(c�(3�(C��of�the�Code. The�undersigned�has�furnished�its�participating�Lender�with�IRS�Form�W-8IM��accompanied�by one� of� the� following� forms� from� each� of� the� members� of� the� undersigned� (or,� in� the� event� that� the undersigned� is� a� Disregarded� Entity,� from� each� of� the� members� of�the� Person� that� is� treated� for� U.S. federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��claiming�the�portfolio�interest exemption:� (i�� an� IRS� Form�W-8BEN� or� IRS� Form�W-8BEN-E� or� (ii�� an� IRS� Form� W-8IM� accompanied�by�an�IRS�Form�W-8BEN�or�IRS�Form�W-8BEN-E�from�each�of�such�member�s�beneficial owners�that�is�claiming�the�portfolio�interest�exemption.��By�executing�this�certificate,�the�undersigned agrees�that�(1��if�the�information�provided�on�this�certificate�changes,�the�undersigned�shall�promptly�so inform�such�Lender�and�(2��the�undersigned�shall�have�at�all�times�furnished�such�Lender�with�a�properly completed�and�currently�effective�certificate�in�either�the�calendar�year�in�which�each�payment�is�to�be made�to�the�undersigned,�or�in�either�of�the�two�calendar�years�preceding�such�payments. Unless�otherwise�defined�herein,�terms�defined�in� the�Credit�Agreement�and�used�herein�shall have�the�meanings�given�to�them�in�the�Credit�Agreement. [NAME�OF�PARTICIPANT� By:______________________________________ Name: Title:

EXHIBIT�H-4 [FORM�OF� U.S.�TAX�COMPLIANCE�CERTIFICATE (For�A�Foreign�Lender�That,�For�U.S.�Federal�Income�Tax�Purposes,�Is�Either�Treated�As�A�Partnership Or�Treated�As�A�Disregarded�Entity�That�Is�Owned�By�A�Partnership� Reference� is� hereby� made� to� the� Credit� Agreement� dated� as� of� March� 23,� 2018� (as�amended, restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�among�nVent Finance�S.��r.l.,�a�Luxembourg�private�limited�liability�company�(Société à responsabilité limitée�,�having its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the�Luxembourg Trade�and�Companies�Register�(R.C.S. Luxembourg��under�number�B�219846�(the�“Company��,�nVent Electric� plc� (the� “Parent��,� Pentair� Technical� ProductsHoffman� Schroff� Holdings,� Inc.� (the� “Initial Affiliate�Borrower��,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from time�to�time�parties�thereto�as�Lenders�and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as�Administrative Agent�for�itself�and�the�other�Lenders�(the�“Administrative�Agent��. Pursuant� to� the� provisions� of� Section� 2.17� of� the� Credit� Agreement,� the� undersigned� hereby certifies�that�(i��it�is�the�sole�record�owner�of�the�Loan(s��(as�well�as�any�Note(s��evidencing�such�Loan(s�� in�respect�of�which�it�is�providing�this�certificate,�(ii��it�is�the�sole�beneficial�owner�of�such�Loan(s��(as well�as�any�Note(s��evidencing�such�Loan(s��for�purposes�other�than�U.S.�federal�income�tax�purposes, (iii��it�(or,�in�the�event�that�the�undersigned�is�a�Disregarded�Entity,�the�Person�that�is�treated�for�U.S. federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��is�not�a�bank�extending�credit pursuant� to� a� loan� agreement� entered� into� in� the� ordinary� course� of� its� trade� or� business� within� the meaning�of�Section�881(c�(3�(A��of�the�Code,�and�(iv��none�of�the�members�of�the�undersigned�(or,�in�the event�that�the�undersigned�is�a�Disregarded�Entity,�none�of�the�members�of�the�Person�that�is�treated�for U.S.�federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��is�(a��a�bank�extending credit�pursuant�to�a�loan�agreement�entered�into�in�the�ordinary�course�of�its�trade�or�business�within�the meaning�of�Section�881(c�(3�(A��of�the�Code,�(b��a�ten�percent�shareholder�of�any�such�Borrower�within the�meaning�of�Section�871(h�(3�(B��of�the�Code,�or�(c��a�controlled�foreign�corporation�related�to�any applicable�Borrower�as�described�in�Section�881(c�(3�(C��of�the�Code. The�undersigned�has�furnished�the�Administrative�Agent�and�the�applicable�Borrower�with�IRS Form�W-8IM��accompanied�by�one�of�the�following�forms�from�each�of�the�members�of�the�undersigned (or,�in�the�event�that�the�undersigned�is�a�Disregarded�Entity,�from�each�of�the�members�of�the�Person�that is�treated�for�U.S.�federal�income�tax�purposes�as�being�the�sole�owner�of�the�undersigned��claiming�the portfolio�interest�exemption:�(i��an�IRS�Form�W-8BEN�or�IRS�Form�W-8BEN-E�or�(ii��an�IRS�Form�W- 8IM�� accompanied� by� an� IRS� Form�W-8BEN� or� IRS� Form�W-8BEN-E� from� each�of�such�member�s beneficial� owners� that� is� claiming� the� portfolio� interest� exemption.� � By� executing� this� certificate,� the undersigned�agrees�that�(1��if�the�information�provided�on�this�certificate�changes,�the�undersigned�shall promptly�so�inform�the�Borrowers�and�the�Administrative�Agent,�and�(2��the�undersigned�shall�have�at�all times� furnished� the� Borrowers� and� the� Administrative� Agent� with�a� properly� completed� and� currently effective�certificate�in�either�the�calendar�year�in�which�each�payment�is�to�be�made�to�the�undersigned,�or in�either�of�the�two�calendar�years�preceding�such�payments. Unless�otherwise�defined�herein,�terms�defined�in� the�Credit�Agreement�and�used�herein�shall have�the�meanings�given�to�them�in�the�Credit�Agreement. [NAME�OF�LENDER�

EXHIBIT�I [FORM�OF� IRISH�QUALIF�ING�LENDER�CONFIRMATION To:� nVent� Finance� S.�� r.l.,� a� Luxembourg� private� limited� liability� company� (Société à responsabilité limitée�,�having�its�registered�office�at�26,�boulevard�Royal,�L-2449�Luxembourg�and�registered�with�the Luxembourg� Trade� and� Companies� Register� (R.C.S. Luxembourg�� under� number� B� 219846,� nVent Electric�plc,�Pentair�Technical�ProductsHoffman�Schroff�Holdings,�Inc.,�and�JPMorgan�Chase�Bank, N.A.,�as�the�Administrative�Agent�under�the�Credit�Agreement�referenced�below: Name�of�Lender:�______________________________________ Address�of�Lender:�____________________________________ Date:�____________________________________ Reference� is� hereby� made� to� that� certain� Credit� Agreement,� dated� as� of� March� 23,� 2018� (as amended,�restated,�supplemented�or�otherwise�modified�from�time�to�time,�the�“Credit�Agreement��,�by and� among� nVent� Finance� S.�� r.l.,� nVent� Electric� plc,� Pentair� Technical� ProductsHoffman� Schroff Holdings,�Inc.,�the�other�Affiliate�Borrowers�from�time�to�time�party�thereto,�the�institutions�from�time�to time�parties�thereto�as�Lenders�and�JPMorgan�Chase�Bank,�N.A.,�in�its�capacity�as�Administrative�Agent for�itself�and�the�other�Lenders. Pursuant�to�Section�2.17(j��of�the�Credit�Agreement,�the�undersigned�Lender�hereby�confirms,�as at�the�date�of�this�Confirmation,�that�it�is: not�an�Irish�Qualifying�Lender��or an�Irish�Qualifying�Lender�(under�paragraph�(f��of�the�definition��or an� Irish� Qualifying� Lender� (under� paragraphs� (a�,� (b�,� (c�,� (d�,� (e�,� or� (g�� of� the definition�. [NAME�OF�LENDER� By:_____________________ Name: Title:


•	amending the objects or memorandum of association of nVent;


•	authorizing the entering into of a guarantee or provision of security in connection with a loan, quasi-loan or credit transaction to a director or connected person;


•	opting out of preemption rights on the issuance of new shares;


•	re-registration of nVent from a public limited company to a private company;


•	variation of class rights attaching to classes of shares (where the articles of association do not provide otherwise);


•	resolving in favor of a shareholders’ voluntary winding-up;


•	a merger pursuant to the EU Cross-Border Merger Directives 2005/56/EC.


•	a court-approved scheme of arrangement under the Irish Companies Act. A scheme of arrangement with shareholders requires a court order from the Irish High Court and the approval of a majority in number representing 75 percent in value of the shareholders present and voting in person or by proxy at a meeting called to approve the scheme;


•	by way of merger with another Irish company under the Irish Companies Act, which must be approved by a special resolution and by the High Court of Ireland.


•	any transfer of those shares, or in the case of unissued shares any transfer of the right to be issued with shares and any issue of shares, shall be void;


•	no voting rights shall be exercisable in respect of those shares;


•	no further shares shall be issued in right of those shares or in pursuance of any offer made to the holder of those shares; and


•	no payment shall be made of any sums due from nVent on those shares, whether in respect of capital or otherwise.


•	in the event of an offer, all holders of security of the target company should be afforded equivalent treatment and, if a person acquires control of a company, the other holders of securities must be protected;


•	the holders of the securities in the target company must have sufficient time and information to enable them to reach a properly informed decision on the offer; where it advises the holders of securities, the board of the target company


•	the board of the target company must act in the interests of the company as a whole and must not deny the holders of securities the opportunity to decide on the merits of the offer;


•	false markets must not be created in the securities of the target company, the bidder or of any other company concerned by the offer in such a way that the rise or fall of the prices of the securities becomes artificial and the normal functioning of the markets is distorted;


•	a bidder must announce an offer only after ensuring that he or she can fulfill in full, any cash consideration, if such is offered, and after taking all reasonable measures to secure the implementation of any other type of consideration;


•	a target company must not be hindered in the conduct of its affairs for longer than is reasonable by an offer for its securities; and


•	a “substantial acquisition” of securities (whether such acquisition is to be effected by one transaction or a series of transactions) shall take place only at an acceptable speed and shall be subject to adequate and timely disclosure.


a)	the action is approved by nVent shareholders at a general meeting; or


i.	it is satisfied the action would not constitute frustrating action;


ii.	nVent shareholders that hold 50 percent of the voting rights state in writing that they approve the proposed action and would vote in favor of it at a general meeting;


iii.	the action is taken in accordance with a contract entered into prior to the announcement of the offer; or


iv.	the decision to take such action was made before the announcement of the offer and either has been at least partially implemented or is in the ordinary course of business.


Section 10.08	Heirs, Assigns, and Personal Representatives 20



Position	Length of Restricted Period
Section 16 Officer	24 months
Salary Grade 44 or 45 Employee	12 months



Name of Company		Jurisdiction of Incorporation
Alberta Electronic Company Limited		Hong Kong
Eldon AB		Sweden
Eldon AS		Norway
Eldon Austria GmbH		Austria
Eldon CS Enclosures Pvt Limited		India
Eldon Electric Limited		United Kingdom
Eldon Espana, S.A.U.		Spain
Eldon GmbH		Germany
Eldon Holding AB		Sweden
Eldon Holding Espana, S.L.U.		Spain
Eldon International NV		Belgium
Eldon NV		Netherlands
Eldon SRL		Romania
Electronic Enclosures, LLC		United States
Enclosures, Inc.		United States
ERICO B.V.		Netherlands
ERICO Canada Inc.		Canada
ERICO Chile Comercial e Industrial Ltda.		Chile
ERICO del Pacifico Comercial e Industrial Ltda.		Chile
ERICO do Brasil Comercio e Industria Ltda.		Brazil
ERICO Europe B.V.		Netherlands
ERICO Europe Holding B.V.		Netherlands
ERICO France Sarl		France
ERICO GLOBAL COMPANY		United States
ERICO GmbH		Germany
ERICO International Corporation		United States
ERICO Italia S.r.l.		Italy
ERICO Lightning Technologies Pty. Limited		Australia
ERICO Limited		Hong Kong
ERICO Ltd.		China
ERICO Mexico, S.A. de C.V.		Mexico
ERICO Poland SP. Z.o.o.		Poland
ERICO Products Australia Pty. Ltd		Australia
ERICO US Holding LLC		United States
Greenspan Singapore Private Limited		Singapore
Hoffman Enclosures (Mex.), LLC		United States
Hoffman Enclosures Mexico, S. de R.L. de C.V.		Mexico
Hoffman Enclosures Inc.		United States
Hoffman Schroff Asia Pte Ltd		Singapore
Hoffman Schroff de Mexico		Luxembourg
Hoffman Schroff Holdings, Inc.		United States
Hoffman Schroff Luxembourg S.a.r.l.		Luxembourg
Hoffman Schroff Manufacturing S. de R.L. de C.V.		Mexico
Hoffman Schroff Poland Sp.z.o.o.		Poland
Hoffman Schroff PTE Ltd		Singapore
Hoffman Schroff Sales S. de R.L. de C.V.		Mexico
Limited Liability Company nVent Rus		Russian Federation
Lionel Acquisition Co.		United States
nVent Armaturen Holding GmbH		Germany



nVent do Brasil Eletrometalurgica Ltda.		Brazil
nVent Electrical Products (Shanghai) Co., Ltd.		China
nVent Electrical Products China Co., Ltd.		China
nVent Electrical Products India Private Limited		India
nVent Finance Group GmbH		Switzerland
nVent Finance Holding GmbH		Switzerland
nVent Finance NL B.V.		Netherlands
nVent Finance S.a.r.l.		Luxembourg
nVent Finland Oy		Finland
nVent Global S.a.r.l.		Luxembourg
nVent Holding NL B.V.		Netherlands
nVent Holdings C.V.		Netherlands
nVent Holdings S.A.		France
nVent Holdings, Inc.		United States
nVent International (UK) Ltd.		United Kingdom
nVent International Holding S.a.r.l.		Luxembourg
nVent International Holdings, Inc.		United States
nVent International Sales Corporation		United States
nVent Italy S.r.l.		Italy
nVent Japan Co., Ltd.		Japan
nVent Luxembourg S.a.r.l.		Luxembourg
nVent Management Company		United States
nVent Middle East FZE		United Arab Emirates
nVent Nordic AP		Sweden
nVent Project Services Canada, Inc.		Canada
nVent Services Canada Limited		Canada
nVent Services GmbH		Switzerland
nVent Services Holding GmbH		Switzerland
nVent Solutions (UK) Limited		United Kingdom
nVent Teknoloji Sistemleri Ticaret Limited Sirketi		Turkey
nVent Thermal (Shanghai) Co., Ltd.		China
nVent Thermal (Shanghai) Engineering Co., Ltd.		China
nVent Thermal Belgium NV		Belgium
nVent Thermal Canada Ltd.		Canada
nVent Thermal Czech s.r.o., v likvidaci		Czech Republic
nVent Thermal Europe GmbH		Switzerland
nVent Thermal France SAS		France
nVent Thermal Germany GmbH		Germany
nVent Thermal India Private Limited		India
nVent Thermal Korea Ltd.		Korea, Republic of
nVent Thermal KZ LLP		Kazakhstan
nVent Thermal LLC		United States
nVent Thermal Netherlands B.V.		Netherlands
nVent Thermal Norway AS		Norway
nVent Thermal Polska Sp. z.o.o.		Poland
nVent Thermal Romania S.R.L.		Romania
nVent UK Holdings Limited		United Kingdom
Optima Enclosures Limited		United Kingdom
Productos ERICO S.A.		Spain
Schroff Co. Ltd. Taiwan		Taiwan
Schroff GmbH		Germany
Schroff Holdings Germany		Germany
Schroff SAS		France



Schroff, Inc.		United States
Steinhauer GmbH		Germany
Tonka Bay Insurance Company		United States
Torgoterm AD*		Bulgaria
Tracer Construction LLC		United States
Tracer Industries Canada Limited		Canada
Tracer Industries Management LLC		United States
Tracer Industries, Inc.		United States
Yabaida Electronics (Shenzhen) Company Limited		China