Exhibit 10.1

Execution Copy

PENTAIR PLC

P.O. Box 471, Sharp Street, Walkden

Manchester, M28 8BU

United Kingdom

September 7, 2015

Mr. Edward P. Garden

Mr. Matthew Peltz

Mr. Brian Baldwin

Trian Fund Management, L.P.

280 Park Avenue, 41st Floor

New York, New York 10017

Dear Ed, Matthew and Brian:

1. (a) Pentair plc (“Pentair” or the “Company”) hereby agrees that (i) (A) at
its annual general meeting of shareholders in 2016 or any special meeting of
shareholders called by the Company prior to such annual general meeting (each,
the “Shareholder Meeting”), Pentair shall submit to its shareholders a
resolution to amend Section 71 of Pentair’s articles of association to increase
the maximum size of the board of directors of Pentair (the “Board”) by one
director to twelve (12) directors (the “Amendment Resolution”), (B) the Board
shall recommend that the shareholders of Pentair vote for the Amendment
Resolution, and the Company and the Board shall take any other necessary action
to ensure that the Amendment Resolution may be approved by an Ordinary
Resolution (as defined in the Articles of Association), (C) the Company shall
use its reasonable best efforts (which shall include the solicitation of
proxies) to obtain the approval of the Amendment Resolution by the shareholders
of the Company (it being understood that such efforts shall not be less than the
efforts used by the Company to obtain the election of the directors nominated by
the Board for election at the Shareholder Meeting (or, in the case of a special
meeting of shareholders, the efforts used by the Company to obtain shareholder
approval for any other action recommended by the Board)) and (D) immediately
after the Shareholder Meeting, the Board shall (conditional on the passage of
the Amendment Resolution) appoint EPG as director to fill the resulting vacancy
on the Board and appoint EPG as a member of Pentair’s Compensation Committee
(the “Compensation Committee”), with each such appointment becoming effective
from and after the date of the Shareholder Meeting, (ii) beginning on or prior
to September 21, 2015 (the “Commencement Date”), until the date of the
Shareholder Meeting, EPG will have the right, subject to the limitations set
forth in paragraph 1(c) of this letter and applicable laws and governmental
regulations, to attend (in person or by teleconference or videoconference), and
participate in, all meetings of the Board (and all meetings of the Compensation
Committee) in a non-voting participant capacity (but EPG’s presence shall not be
counted towards the quorum of the Board or the Compensation Committee) and
(iii) beginning on the Commencement Date, until the later of (A) the date of the
Shareholder Meeting and (B) if EPG is appointed as director of Pentair on the
date of the Shareholder Meeting, the date EPG (or any other employee of Trian
Fund Management, L.P. (“Trian”)) is no longer a director of Pentair (such date,
the “Termination Date”), either of Matthew Peltz or Brian Baldwin (such
individual (who may vary from meeting to meeting and may be determined by Trian
in its sole discretion), when acting in his capacity as

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Trian Fund Management, L.P.

September 7, 2015

Page 2

 

a Board observer of the Company, the “Board Observer”) shall have the right,
subject to the limitations set forth in this letter and applicable laws and
governmental regulations, to attend (in person or by teleconference or
videoconference) all meetings of the Board (and all meetings of the Compensation
Committee) in a non-voting, non-participating observer capacity (but the Board
Observer’s presence shall not be counted towards the Board’s or the Compensation
Committee’s quorum); provided, that, in the event that the Board or the
Compensation Committee, as applicable, determines to hold an executive session
(which EPG shall be entitled to attend regardless of whether he is a director or
Board participant at the time) (an “Executive Session”), and the Board or the
Compensation Committee, as applicable, (acting reasonably and in good faith)
determines that it would not be appropriate for the Board Observer to attend
such Executive Session or any portion thereof, the Board Observer shall not have
the right to attend, and shall recuse himself from, such Executive Session or
portion thereof to the extent requested by the Board or the Compensation
Committee, as applicable. To facilitate the appointment of EPG as a Board
participant and director, the Board will, simultaneously with the adoption of
the resolutions providing for the matters described in clauses (i) through
(iii) above (which shall be adopted on the Commencement Date), also adopt
certain other enabling resolutions mutually acceptable to Trian and Pentair (the
“Facilitating Resolutions”).

(b) The Company shall provide EPG in his capacity as a participant pursuant to
clause (ii) of paragraph 1(a) of this letter and, until the Termination Date,
the Board Observer, with (x) notice of all meetings of the Board and the
Compensation Committee, including notice of time and place of any such meetings,
(y) all written materials or other correspondence delivered to the members of
the Board or the Compensation Committee, as the case may be, for consideration
at such meetings or any other purpose, and (z) all proposed written consent
actions provided to the Board or the Compensation Committee, as the case may be,
in each case, at the same time and in the same manner such notice and
information is delivered to the members of the Board; provided, that the failure
to provide or make available one or more items described in this paragraph 1(b)
shall not affect the validity of any action taken by the Board or the
Compensation Committee.

(c) Notwithstanding the foregoing, as long as EPG participates in Board meetings
in a participant capacity pursuant to clause (ii) of paragraph 1(a) of this
letter, (A) the Company shall have the right to withhold any notice or
information from EPG or the Board Observer and to exclude EPG or the Board
Observer from any meeting of the Board or the Compensation Committee or any
portion thereof to the extent access to such information or attendance at such
meeting or any portion thereof could reasonably be expected to remove the
attorney-client privilege between the Company and its counsel; and (B) each of
EPG and the Board Observer shall be required to recuse himself from any portion
of any Board or Compensation Committee meeting if either EPG or the Board
Observer would be required to recuse himself from such portion of the meeting
under applicable law, governmental regulations or the Company’s policies and
procedures if he had been a director of the Company at the time. Notwithstanding
anything in this letter to the contrary, unless otherwise consented to in
writing by each of the other parties to this letter, the rights of each of EPG
and the Board Observer pursuant to clause (ii) and clause (iii), respectively,
of paragraph 1(a) of this letter shall be personal to each of them and shall not
be assigned or otherwise transferred by any of them to any other person under
any circumstances, and any purported assignment or transfer by any of them

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Trian Fund Management, L.P.

September 7, 2015

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of their respective rights pursuant to clause (ii) or clause (iii), as
applicable, of paragraph 1(a) of this letter shall be null and void ab initio
and shall have no effect. For as long as EPG attends Board or Compensation
Committee meetings in a participant capacity pursuant to clause (ii) of
paragraph 1(a) of this letter, the Company shall reimburse EPG for expenses
incurred in connection with his attendance at such meetings to the same extent
and in the same manner as it reimburses the directors of the Company. In
addition, beginning at such time as EPG becomes a director of the Company
pursuant to clause (i) of paragraph 1(a) of this letter, EPG shall be entitled
to receive compensation and expense reimbursement to the same extent and in the
same manner as the other directors of the Company. The Company acknowledges that
EPG may (1) exercise, assign, sell or otherwise transfer (or hold for the
benefit of another party) any securities of the Company that he has been or may
be granted under the Company’s incentive plans or otherwise as directed by Trian
or its designee and (2) assign, convey and deliver to (or hold for the benefit
of) Trian or its designee all stock or other property (including, without
limitation, cash) received upon such exercise, assignment or sale or other
transfer. In addition, the Company confirms that any Pentair securities held by
Trian or the investment funds or vehicles that it advises, manages or controls
(collectively, the “Trian Funds”) shall be deemed to be held by EPG for purposes
of the director stock ownership requirements contained in Pentair’s Corporate
Governance Principles and/or any other applicable policies of Pentair. From and
after the date of this letter agreement, the Company agrees that EPG shall be
covered under the Company’s directors’ and officers’ liability insurance
policies for his service as a director and Board participant and each of EPG,
Mathew Peltz and Brian Baldwin shall be covered under contractual
indemnification agreements for his service as a director, or Board participant
or Board observer, as applicable, in each case, to the same extent and in the
same manner as the directors of the Company. Except as described above, the
Board Observer shall not be entitled to receive any compensation or expense
reimbursement from the Company for his attendance at meetings of the Board or
the Compensation Committee.

2. Promptly following the execution of this letter, Pentair and Trian will issue
a joint press release substantially in the form attached hereto as Exhibit A.

3. (a) You acknowledge that you are sensitive to Pentair’s concerns regarding
confidentiality and other regulatory issues, and you agree to restrict
yourselves as set forth in this letter in order to address those considerations.
To that end, you hereby undertake, except to the extent legally required, to
refrain from directly or indirectly communicating or disclosing to anyone
confidential or non-public information that you learn in your capacity as a
participant or observer in Board or Compensation Committee meetings or as a
director of Pentair, as applicable; provided, that you may communicate such
information to personnel of Trian and to Trian’s outside legal, tax, insurance
and accounting advisors (such personnel of Trian and such advisors, together
with such advisory firms, the “Trian Associates”) that need to know such
information for purposes of the analysis of Trian’s investment in Pentair and/or
a review of the financial and business affairs of the Company on your or Trian’s
behalf; provided, further, that Trian shall be (and shall cause the Trian
Associates to be) bound by these same confidentiality restrictions applicable to
you, with respect to all confidential or non-public information conveyed by you,
or by or on behalf of the Company or any of its representatives, to Trian or to
any Trian Associates. Trian agrees that it shall be responsible for any breach
of this letter by Trian, the Trian Funds and the Trian Associates.

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Trian Fund Management, L.P.

September 7, 2015

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(b) For purposes of this letter, information shall not be considered
confidential or non-public information where: (i) it becomes or was available to
the public other than as a result of disclosure by you, Trian or a Trian
Associate in breach of this letter; (ii) it was available to you, Trian or a
Trian Associate prior to being communicated or disclosed to you, Trian or a
Trian Associate by the Company or one of its directors, officers, employees,
advisors or representatives (collectively, “Company Agents”), provided that such
information is not known by you, Trian or such Trian Associate to be subject to
a legal, contractual or fiduciary obligation of confidentiality to the Company;
(iii) it is or becomes available to you, Trian or a Trian Associate from a
source other than the Company or a Company Agent, provided the source is not
known by you, Trian or such Trian Associate to be prohibited from transmitting
the information by a confidentiality agreement with the Company or any other
contractual, legal or fiduciary obligation of confidentiality to the Company; or
(iv) it was independently developed by you, Trian or a Trian Associate without
the benefit of confidential or non-public information received from the Company
or a Company Agent in connection with your participation in Board or
Compensation Committee meetings in a participant or observer capacity or service
as a director, as applicable.

(c) In the event you, Trian or a Trian Associate (each, a “Receiving Party”)
receives a request or is required by legal, judicial or administrative process
(including interrogatories, oral questions, court or stock exchange, subpoena,
civil investigative demand or similar legal process), or receives a request from
a governmental, regulatory or supervisory authority, court or stock exchange to
disclose any confidential or non-public information received from the Company or
a Company Agent in connection with your participation in Board or Compensation
Committee meetings in a participant or observer capacity or service as a
director, as applicable, each of you or Trian, as applicable, agree to, as
promptly as practicable, to the extent not prohibited by law, to notify the
Company of such a requirement or request, so that the Company may seek, at the
Company’s expense, an appropriate protective order and/or waive compliance with
the terms of this letter. In the event such protective order or other protection
is denied and a Receiving Party is nonetheless legally compelled or requested to
disclose such information, it may furnish (without any liability under this
letter) only that portion of the confidential or non-public information that the
Receiving Party’s legal counsel advises is being required and will exercise
commercially reasonable efforts to protect the confidentiality of the remaining
information. The Receiving Parties shall be entitled to reimbursement of their
reasonable out-of-pocket expenses, including reasonable fees and expenses of
legal counsel, for any action taken by them in connection with this paragraph
3(c) at the Company’s request.

(d) In addition, each of you and Trian acknowledges, and Trian agrees to advise
each Trian Associate who is informed of the matters which are the subject of
this letter, that the confidential or non-public information that is subject to
the confidentiality provisions herein may constitute material non-public
information under applicable U.S. federal and state securities laws, and that
the U.S. securities laws prohibit any person who has received from an issuer
such material non-public information from purchasing or selling securities of
such issuer while in possession of such material non-public information.

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Trian Fund Management, L.P.

September 7, 2015

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(e) Each of you and Trian agrees that any proprietary information of the Company
received from or on behalf of the Company shall remain the property of the
Company. None of you, Trian and the Trian Associates shall, by virtue of the
Company’s disclosure of, or your, Trian’s or any Trian Associates’ use of, any
such proprietary information, acquire any rights with respect thereto, all of
which rights (including all intellectual property rights) shall remain
exclusively with the Company.

(f) Furthermore, except as otherwise agreed in writing by the Company (whether
before or after the date hereof), (i) EPG agrees that, as long as he
participates in Board or Compensation Committee meetings in a participant
(non-director) capacity, he will comply with the Company’s Insider Trading
Policy, Corporate Governance Principles, External Communications and Disclosure
Policy, Related-Person Transactions Approval Policy, and, to the extent the
Mr. Garden is acting in his capacity as a participant, the Company’s
Anti-Bribery Policy, Political Contributions Policy, Procedures Governing
Interactions with Government Officials and Third Parties and Code of Business
Conduct and Ethics (to the extent that each policy is applicable generally to
the Company’s directors and with the understanding that such policies will be
applied to EPG on a reasonable and good faith basis and in a manner consistent
with the Facilitating Resolutions) and (ii) each of Matthew Peltz and Brian
Baldwin agrees that, until the Termination Date, each will comply with the
Company’s Insider Trading Policy, External Communications and Disclosure Policy,
Related-Person Transactions Approval Policy and, to the extent that Mr. Peltz or
Mr. Baldwin is acting in his capacity as a Board Observer, the Company’s Code of
Business Conduct and Ethics (insofar as such Code of Business Conduct and Ethics
is applicable to Mr. Peltz, Mr. Baldwin or any of their immediate family members
that are employed by Trian), Anti-Bribery Policy, Political Contributions
Policy, and Procedures Governing Interactions with Government Officials and
Third Parties (to the extent that each policy is applicable generally to the
Company’s directors and with the understanding that such policies will be
applied to each such individual on a reasonable and good faith basis and in a
manner consistent with the Facilitating Resolutions) (in each case, as such
policies are currently in effect, together with changes to such policies
applicable to directors of Pentair generally and applied to you on a reasonable
and good faith basis and in a manner consistent with the Facilitating
Resolutions). In addition, except as otherwise agreed between Trian and Pentair,
Trian will not, and will not permit the Trian Funds to, engage in the purchase
or sale of Pentair securities during Pentair trading blackout periods (under the
restriction calendar currently in effect, together with any changes to such
calendar or unscheduled blackout periods of which you are made aware (in either
case imposed on a reasonable and good faith basis)) that are applicable to all
directors of Pentair. Pentair agrees to notify EPG and Trian in advance when any
trading blackout period begins and ends. Pentair shall not be responsible for
compliance by Trian, the Trian Funds, any Trian Associates or you with the
securities laws, including regulations relating to insider trading.

4. This letter (except for paragraphs 4-11 hereof) shall terminate eighteen
months after the Termination Date; provided, that if the Company breaches any of
its obligations under paragraph 1(a) in any material respect, paragraph 3 of
this letter shall immediately terminate (except that paragraph 3 shall not
terminate pursuant to this proviso if: (i) EPG has already been appointed to the
Board pursuant to the terms of paragraph 1(a)(i)(D) or (ii) EPG, Mr. Peltz,
Mr. Baldwin or the Receiving Parties are in breach of their obligations under
paragraph 3 in any material respect (after being given reasonable notice and an
opportunity to cure such breach) at the time of any such alleged breach by the
Company of its obligations under paragraph 1(a)).

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Trian Fund Management, L.P.

September 7, 2015

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5. Each party represents and warrants that (a) it has the power and authority to
execute, deliver and carry out the terms and provisions of this letter and to
consummate the transactions contemplated hereby and (b) this letter has been
duly and validly authorized, executed and delivered by each party, and assuming
the due and valid authorization, execution and delivery by the other parties
hereto, constitutes a valid and binding agreement of each party and is
enforceable against such party in accordance with its terms.

6. All attorneys’ fees, costs and expenses incurred in connection with this
letter and, except as otherwise provided herein, all matters related hereto will
be paid by the party incurring such fees, costs or expenses.

7. Each of the parties bound by this letter consents and submits to the
exclusive jurisdiction of the courts of the State of New York located in the
Borough of Manhattan in New York City and the courts of the United States
located in the Borough of Manhattan in New York City in the State of New York
for the adjudication of any action or legal proceeding relating to or arising
out of this letter (and each such person agrees not to commence any action or
legal proceeding relating thereto except in any such court). Each of the parties
bound by this letter irrevocably and unconditionally waives any objection which
it may now or hereafter have to the laying of venue in such courts and agrees
not to plead or claim in any such court that any such action or legal proceeding
brought in any such court has been brought in an inconvenient forum. Each of the
parties bound by this letter agrees that service of any process, summons, notice
or document by U.S. registered mail addressed to such person shall be effective
service of process for any such suit, action or proceeding brought against such
person in any such court. Each of the parties bound by this letter hereby agrees
that a judgment in any such suit, action or proceeding brought in any such court
shall be conclusive and binding upon such person and may be enforced in any
other courts to whose jurisdiction such person is or may be subject by suit upon
such judgment.

8. Each party to this letter agrees that money damages would not be a sufficient
remedy for any breach of this letter by the other party hereto, and that the
non-breaching party shall be entitled to, and the breaching party shall not
oppose (on the basis that there is an adequate remedy at law) the granting of,
equitable relief, including injunction and specific performance, in the event of
any such breach, in addition to all other remedies available to the
non-breaching party at law or in equity. The breaching party further agrees to
waive any requirement for the securing or posting of any bond in connection with
such remedy.

9. No failure or delay by any party hereto in exercising any right, power or
privilege hereunder will operate as a waiver thereof, nor will any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any right, power or privilege hereunder.

10. This letter and any dispute arising out of or in connection with it or its
subject matter or formation (including non-contractual disputes or claims) shall
be governed by and construed in accordance with the laws of New York.

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Trian Fund Management, L.P.

September 7, 2015

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11. This letter may be modified or amended only by a separate writing signed by
the parties hereto expressly so modifying or amending this letter. This letter
constitutes the entire agreement among the parties with respect to the subject
matter hereof and supersedes all prior oral or written agreements or
understandings that may exist between such parties hereto with respect to the
subject matter hereof, except as contemplated by the first sentence of paragraph
3(f) of this letter. This letter shall inure to the benefit of and shall be
binding upon the parties hereto and their respective successors and permitted
assigns, and nothing herein is intended to confer on any person other than the
parties hereto or their respective successors and permitted assigns, any rights,
remedies, obligations or liabilities under or by reason of this letter. The
rights and obligations of any party under this letter may not be transferred
without the consent of the other parties hereto, and any transfer in violation
of this sentence shall be null and void.

We look forward to working together with you and Trian.

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Very truly yours, PENTAIR PLC By:  

/s/ Angela D. Lageson

  Name:   Angela D. Lageson   Title:   Senior Vice President, General Counsel
and Secretary

 

AGREED TO AND ACCEPTED AS OF THE DATE FIRST WRITTEN ABOVE

/s/ Edward P. Garden

EDWARD P. GARDEN

/s/ Matthew Peltz

MATTHEW PELTZ

/s/ Brian Baldwin

BRIAN BALDWIN TRIAN FUND MANAGEMENT, L.P. By:   Trian Fund Management GP, LLC,  
its general partner By:  

/s/ Edward P. Garden

  Name:   Edward P. Garden   Title:   Member

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Exhibit A

Press Release

PENTAIR TO PROPOSE EXPANSION OF ITS BOARD TO INCLUDE TRIAN’S ED GARDEN

Garden to be Appointed to Board upon Shareholder Approval

Manchester, United Kingdom – September 8, 2015 – Pentair plc (NYSE: PNR) today
announced that it will recommend to its shareholders that they approve a
resolution at its 2016 annual general meeting of shareholders to increase the
size of its Board by one director and will appoint Ed Garden, Chief Investment
Officer and a Founding Partner of Trian, to the Pentair Board to fill the
resulting vacancy. With the addition of Mr. Garden, Pentair’s Board will have 12
directors, 11 of whom are independent. In the interim period prior to the 2016
annual general meeting of shareholders, Mr. Garden will be able to attend and
participate in all meetings of Pentair’s Board in a non-voting capacity. The
move follows a series of collaborative discussions between Pentair and Trian,
one of Pentair’s largest shareholders with a 7.2% ownership position.

“We have maintained an active and constructive dialogue with Trian regarding our
common goal of increasing shareholder value, as we do with all of our
shareholders” said Randall J. Hogan, Pentair’s Chairman and CEO. “We believe the
addition of Ed to our board would bring a shareholder’s perspective and we look
forward to benefiting from his insights and Trian’s strong analytical work.
Pentair remains focused on driving productivity and identifying strategic
opportunities to position our portfolio for long-term growth.”

Garden added: “Pentair has created significant shareholder value over the past
14 years since Randy Hogan became CEO and has the potential to generate
significant additional value for its shareholders in the years ahead. As one of
Pentair’s largest shareholders, Trian looks forward to continuing to work with
Pentair to further improve the company’s performance through increased organic
revenue growth, margin enhancement, and accretive acquisitions.”

Upon his appointment to the Pentair Board, Garden will join the Compensation
Committee of Pentair’s Board.

Ed Garden Biography

Mr. Garden is Chief Investment Officer and a Founding Partner of Trian.
Mr. Garden oversees Trian’s portfolio management, idea generation, analyses and
due diligence activities. Mr. Garden is currently a director of The Wendy’s
Company and The Bank of New York Mellon Corporation. Mr. Garden previously
served as a director of Family Dollar Stores, Inc. from September 2011 to July
2015.

About Pentair plc

Pentair plc (www.pentair.com) delivers industry-leading products, services and
solutions for its customers’ diverse needs in water and other fluids, thermal
management and equipment protection. With 2014 revenues of $7.0 billion, Pentair
employs approximately 30,000 people worldwide.

About Trian Fund Management, L.P.

Founded in 2005 by Nelson Peltz, Peter May and Ed Garden, Trian seeks to invest
in high quality but undervalued public companies and to work constructively with
the management and boards of those companies to significantly enhance
shareholder value for all shareholders through a combination of improved
operational execution, strategic re-direction, more efficient capital allocation
and increased focus.

 

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Contacts:

Pentair plc Media Relations

Rebecca Osborn

763-656-5580

rebecca.osborn@pentair.com

Pentair plc Investors

Jim Lucas

763-656-5575

jim.lucas@pentair.com

Trian Media/Investors

Anne Tarbell

212-451-3030

atarbell@trianpartners.com

 

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