EX-10.4






Exhibit 10.4




PENTAIR, INC.




RESTORATION PLAN




As Amended and Restated Effective January 1, 2009




 









 





PENTAIR, INC.

RESTORATION PLAN




TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page
	SECTION 1.	 	Name of Plan
	 	 	1	 
	SECTION 2.	 	General Definitions
	 	 	1	 
	SECTION 3.	 	Participation, Vesting And Benefit Service, And Rules Governing The Crediting Of Service,
	 	 	6	 
	 	 	Disability And The Determination Of Compensation And Final Average Compensation
	 	 	 	 
	(a)	 	Participation
	 	 	6	 
	(b)	 	Vesting
	 	 	7	 
	(c)	 	Benefit Service
	 	 	7	 
	(d)	 	Service Credits
	 	 	7	 
	(e)	 	Disability
	 	 	8	 
	(f)	 	Compensation
	 	 	10	 
	SECTION 4.	 	Payments In The Event Of Death Before The Benefit Commencement Date
	 	 	10	 
	SECTION 5.	 	Payment Of Retirement Benefits
	 	 	10	 
	SECTION 6.	 	Confidentiality, Covenants Not To Compete, And Non - Solicitation
	 	 	10	 
	(a)	 	General
	 	 	10	 
	(b)	 	Forfeiture and Other Remedies
	 	 	11	 
	SECTION 7.	 	Funding And Payment Of Benefits
	 	 	12	 
	(a)	 	General
	 	 	12	 
	(b)	 	Employer Company
	 	 	12	 
	(c)	 	Company Assumption of Liability
	 	 	12	 
	(d)	 	Participation by Other Group Members
	 	 	13	 
	SECTION 8.	 	Default
	 	 	13	 
	SECTION 9.	 	Administration Of The Plan
	 	 	13	 
	(a)	 	General
	 	 	13	 
	(b)	 	Committee
	 	 	14	 
	(c)	 	Discretion
	 	 	14	 
	(d)	 	Indemnity
	 	 	14	 
	(e)	 	Code Section 409A
	 	 	14	 
	(f)	 	Use of Professional Services
	 	 	14	 
	(g)	 	Communications
	 	 	15	 
	SECTION 10.	 	Effect of KEESA
	 	 	15	 
	SECTION 11.	 	Amendment Or Termination
	 	 	15	 
	(a)	 	General
	 	 	15	 
	(b)	 	Limitation on Power to Amend or Terminate
	 	 	15	 
	(c)	 	Change in Control
	 	 	16	 
	(d)	 	Continuation of Plan Provisions
	 	 	16	 
	SECTION 12.	 	Claims
	 	 	16	 
	(a)	 	Filing Claims
	 	 	16	 
	(b)	 	Decision on Claim
	 	 	17	 






 









 






	 	 	 	 	 	 	 
	 	 	 	 	Page
	(c)	 	Appeal of Denied Claim
	 	 	17	 
	(d)	 	Decision by Appeals Committee
	 	 	17	 
	SECTION 13.	 	Miscellaneous
	 	 	17	 
	(a)	 	Employer’s Rights
	 	 	17	 
	(b)	 	Interpretation
	 	 	18	 
	(c)	 	Withholding of Taxes
	 	 	18	 
	(d)	 	Offset for Amounts Due
	 	 	18	 
	(e)	 	Computational Errors
	 	 	18	 
	(f)	 	Requirement of Proof
	 	 	18	 
	(g)	 	Tax Consequences
	 	 	18	 
	(h)	 	Communications
	 	 	19	 
	(i)	 	Not Compensation Under Other Benefit Plans
	 	 	19	 
	(j)	 	Choice of Law
	 	 	19	 
	(k)	 	Savings Clause
	 	 	19	 
	(l)	 	Change in Control
	 	 	19	 
	SECTION 14.	 	Transition Rules
	 	 	19	 
	(a)	 	General
	 	 	19	 
	(b)	 	2004 Vested Participants Benefits
	 	 	19	 
	(c)	 	Excess 
	 	 	20	 







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PENTAIR, INC. RESTORATION PLAN




     SECTION 1. Name of Plan. This plan shall be known as the Pentair, Inc. Restoration Plan.



     SECTION 2. General Definitions. Unless the context requires otherwise, when used herein the terms
listed below, when capitalized or applied to such capitalized terms, shall have the following
meanings:



               (1) “Adjustment Factor” is the factor used in adjusting the Pension Amount to reflect the
period of time between the date a Participant has a Separation from Service and his or her Benefit
Commencement Date. The Adjustment Factor shall be the same adjustment factor applicable to such
Participant under the SERP.



               (2) “Administrator” is the Company.



               (3) “Beneficiary” is a person entitled to receive benefits, if any, payable under the Plan
after a former Participant’s death.



               (4) “Benefit Commencement Date” is the first day of the first calendar month as of which a
Participant’s Retirement Benefit is payable and shall be the same date as the Participant’s benefit
commencement date under the SERP.



               (5) “Benefit Service” is the number of Years of Service, beginning with the calendar year
which includes the individual’s Benefit Service Date, during which an individual completes 1,000
Hours of Service as an Eligible Employee. Notwithstanding anything herein to the contrary, Benefit
Service shall not be credited for any period after December 31, 2017.



               (6) “Benefit Service Date” is the date from and after which an individual may earn Benefit
Service, and shall be the same date as an individual’s benefit service date under the SERP.



               (7) “Benefit Service Percentage” is the sum of the percentages for each Year of Benefit
Service completed, with the percentage for each such year determined as described below and
dependent upon the individual’s age in whole years as of the first day of the calendar year in
which that Year of Benefit Service is completed.



	 	 	 	 	 
	Attained Age in Whole Years	 	 
	at Beginning of Relevant	 	 
	Year of Benefit Service	 	Percentage
	< 25
	 	 	4	%
	> 25 and < 35
	 	 	5.5	%
	> 35 and < 45
	 	 	7	%
	> 45 and < 55
	 	 	9	%
	> 55
	 	 	12	%






 









 





          Example: Employee A, date of birth January 25, 1954, has a Benefit Service Date of
May 1, 1999. Employee A remains an Eligible Employee and completes 1,000 Hours of Service in each
calendar year from and including 1999 through 2010. Employee A retires on March 1, 2011 and does
not complete 1,000 Hours of Service in that year. Employee A’s Benefit Service Percentage is 109%
computed as follows:




	 	 	 	 	 
	Year of Benefit Service	 	Percentage
	1999
	 	 	7	%
	2000 - 2009, inclusive
	 	 	90	%
	2010
	 	 	12	%
	 
	 	 	 	 
	Total
	 	 	109	%






     Notwithstanding the foregoing, a Participant’s Benefit Service Percentage shall not increase
after December 31, 2017.



               (8) “Change In Control” is a change in control of the Company as defined in the KEESA.



               (9) “Code” is the Internal Revenue Code of 1986, as amended. Any reference to specific
provision of the Code shall be deemed to refer to any successor provision thereto and the
regulations promulgated thereunder.



               (10) “Committee” is the Compensation Committee of the Board of Directors of the Company.



               (11) “Company” is Pentair, Inc., a Minnesota corporation, or any successor thereto.



               (12) “Compensation” is any item or class of remuneration or part thereof listed or described
in the left-hand column of Schedule 1 and not any such items listed or described in the right-hand
column of Schedule 1. In the event a remuneration item is not listed or described in Schedule 1,
the Administrator shall determine whether such item is included or excluded from Compensation by
taking into account the nature of the item and its similarity to an item which is so listed.



               (13) “Conversion Factor” is the factor used to convert the Pension Amount into the Monthly
Installment, and shall be the same as the conversion factor under the SERP.



               (14) “Covered Compensation” is Final Average Compensation reduced by Section 401(a)(17)
Compensation. Covered Compensation earned after December 31, 2017 shall not be counted under the
Plan.



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               (15) “Covered Termination” is a covered termination, as defined in the KEESA, which entitles a
Participant to a termination payment pursuant to Sections 8 and 9(a) of the KEESA.



               (16) “Disabled” or “Disability” is a physical or mental condition, resulting from physical or
mental sickness or injury, which prevents the individual from engaging in any substantial gainful
activity, and which condition can be expected to last for a continuous period of not less than
twelve (12) months.



               (17) “Effective Date” of the Plan is January 1, 1999; the effective date of this amended and
restated Plan document is January 1, 2009.



               (18) “Eligible Employee” is an individual who is an eligible employee under the SERP.
Notwithstanding the foregoing, only individuals who are Eligible Employees on December 31, 2007
shall be entitled to be treated as an Eligible Employee for any period on or after January 1, 2008.



               (19) “Employer Company” is the Group member which employs a Participant as of the date the
Participant has a Separation from Service or otherwise terminates all Group employment due to death
or Disability.



               (20) “ERISA” is the Employee Retirement Income Security Act of 1974, as amended. Any
reference to a specific provision of ERISA shall be deemed to include any successor provision
thereto and the regulations promulgated thereunder.



               (21) “Final Average Compensation” is the average Compensation determined by averaging
Compensation in those five (5) consecutive calendar years out of the last ten (10) consecutive
calendar years, ending with the earlier of (i) the calendar year which ends coincident with or
immediately preceding the date the Participant has a Separation from Service, or otherwise ceases
to be an Eligible Employee, whichever occurs first, or (ii) the calendar year ending December 31,
2017, for which the average Compensation is the highest.



          Notwithstanding the immediately preceding paragraph, Final Average Compensation shall not be
less than the average Compensation for the sixty (60) months immediately preceding the date the
Participant has a Separation from Service or otherwise ceases to be an Eligible Employee, whichever
occurs first, determined as the sum of Compensation in the final calendar year of such employment
plus Compensation in each of the four (4) calendar years preceding the final calendar year of such
employment plus a percentage of the Compensation for the entire fifth calendar year preceding the
final calendar year of such employment; such percentage shall be determined as twelve minus the
number of full calendar months for which Compensation was payable in the final calendar year of
such employment divided by the number of months for which Compensation was paid in the fifth
calendar year preceding the final calendar year of such employment.




          If the Participant’s relevant Compensation history is for less than the stated period of time
(e.g., less than five (5) years; less than ten (10) years), then such actual period shall be
substituted in determining Final Average Compensation (e.g., if the individual has six (6) years of
Compensation history, the high five (5) consecutive years within such six (6) years shall be
used in determining the average; if the individual has three (3) years of Compensation
history, all such Compensation shall be used in determining the average).




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               (22) “Group” is the Company and, except as prescribed by the Administrator, each other
corporation or unincorporated business which is a member of a controlled group of corporations or a
group of trades or businesses under common control (within the meaning of Code section 414(b) or
(c)) which includes the Company, but with respect to other business entities during only the
periods of such common control with the Company.



               (23) “Hour Of Service” is each hour which an individual is paid or entitled to payment from a
Group member for (i) the performance of duties as its employee and (ii) reasons related to such
employment but other than for the performance of duties, such as vacation, illness, jury duty,
military duty or leave of absence other than (x) payments made or due under a plan maintained
solely to comply with worker’s compensation, unemployment compensation, or disability insurance
laws, or (y) payments made solely for reimbursement of medical or medically related expenses;
provided, however, no more than 501 Hours of Service shall be credited under clause (ii)
immediately preceding for any single continuous period during which no duties as such an employee
are performed. An individual shall not receive duplicate Hour of Service credits for the same
period of service or absence.



          Regardless of the actual number of Hours of Service completed during a year, in determining
whether 1,000 Hours of Service have been completed during a calendar year an individual shall be
credited with forty-five (45) Hours of Service for each calendar week the individual is otherwise
credited with an Hour of Service pursuant to the immediately preceding paragraph.



               (24) “KEESA” is the Key Executive Employment and Severance Agreement, if any, in effect
between the Company and the Participant.



               (25) “Monthly Installment” is a monthly payment, commencing as of the Participant’s Benefit
Commencement Date, payable for a term certain of one hundred eighty (180) consecutive months, and
shall be determined by dividing the Participant’s Pension Amount by the Conversion Factor, with
such monthly payment rounded to the nearest whole dollar amount.



               (26) “Participant” is an Eligible Employee who has become a participant under the SERP. Once
an individual becomes a Participant, he or she shall remain a Participant, except as provided in
Section 3, until the first to occur of his or her death, Disability, or Separation from Service;
provided, however, if the individual has a non-forfeitable right to a Retirement Benefit as of the
date he or she incurs such an event (determined without regard to the forfeiture provision of
Section 6(b) unless such section has been actually enforced as to such individual), then absent
death the individual shall remain a Participant until the individual has received his or her entire
Retirement Benefit or the Retirement Benefit has been forfeited as provided for in Section 6(b).



4









 





               (27) “Participation Date” is an Eligible Employee’s participation date under the SERP.



               (28) “Pension Amount” is an amount equal to the Participant’s Covered Compensation multiplied
by his or her Benefit Service Percentage, with such amount then multiplied by the Adjustment Factor
if the Participant survives to his or her Benefit Commencement Date.



               (29) “Pension Plan” is the Pentair, Inc. Pension Plan, or any successor plan thereto.



               (30) “Plan” is the retirement plan herein described. When this term is modified by or with
reference to a certain date (e.g., Plan as in effect before year XXXX), it shall refer to the Plan
as described in the Plan document in effect for the period referenced.



               (31) “Retirement Benefit” is the monthly retirement benefit payable under the Plan as the
Monthly Installment.



               (32) “Section 401(A)(17) Compensation” is the amount which would constitute Final Average
Compensation if the determination of Final Average Compensation was limited by the provisions of
Code section 401(a)(17). Except as modified pursuant to the Administrator’s discretion as provided
for under section 3(f)(2), for this purpose Code section 401(a)(17) shall be applied as under the
Pension Plan, regardless of whether the Participant concerned is covered by the Pension Plan or any
other tax-qualified defined benefit plan sponsored by a Group member.



               (33) “Separates from Service” or “Separation from Service” is the termination of employment as
an employee, from all business entities that comprise the Group, for reasons other than death or
Disability. A Participant will be deemed to have incurred a Separation from Service when the level
of bona fide services performed by the Participant for the Group permanently decreases to a level
equal to twenty percent (20%) or less of the average level of services performed by the Participant
for the Group during the immediately preceding thirty-six (36) month period (or such lesser period
of service). Notwithstanding the foregoing, a Participant on a bona fide leave of absence from the
Group shall be considered to have incurred a Separation from Service no later than the six (6)
month anniversary of the absence (or twenty-nine (29) months in the event of an absence due to a
medically determinable physical or mental impairment which can be expected to result in death or
can be expected to last for a continuous period of not less than six (6) months, where such
impairment causes the Participant to be unable to perform the duties of his or her position or a
substantially similar position) or the end of such longer period during which the individual has
the right by law or agreement to return to employment upon the expiration of the leave.
Notwithstanding the foregoing, if following the Participant’s termination of employment from the
Group the Participant becomes a non-employee director or becomes or remains a consultant to the
Group, then the date of the Participant’s Separation from Service may be delayed until the
Participant ceases to provide services in such capacity to the extent required by Code section
409A.



5









 





               (34) “SERP” is the Pentair, Inc. Supplemental Executive Retirement Plan as amended and
restated effective January 1, 2009, but without regard to Appendix A thereto.



               (35) “Spouse” is an individual, of a sex opposite to that of a Participant, whose marriage to
a Participant is recognized under the laws of the United States (or one of the United States) or
any other generally recognized jurisdiction.



               (36) “Year of Service” is a calendar year in which an individual completes 1,000 Hours of
Service.



     SECTION 3. Participation, Vesting And Benefit Service, And Rules Governing The Crediting Of
Service, Disability And The Determination Of Compensation And Final Average Compensation.



          (a) Participation.




               (1) General. The primary purpose of the Plan is to provide supplemental retirement
benefits to Eligible Employees to reflect the loss of pension benefits under tax-qualified defined
benefit plans sponsored by a member or members of the Group due to the provision of Code section
401(a)(17). It is intended that the employees covered by the Plan constitute a select group of
management or highly paid employees, within the meaning of ERISA section 201(2), of the Group.
Except as provided in Section 3(d)(6), in the event an individual who is not within such a select
group becomes covered by the Plan, then notwithstanding any Plan provision to the contrary such
individual’s participation in the Plan shall immediately cease and retroactively he or she shall be
treated as never having been covered by the Plan.



          Because the Plan is described in ERISA section 201(2), and other ERISA provisions
corresponding thereto, certain provisions of ERISA do not apply to it and the benefits earned
thereunder, including the provisions of Parts 2, 3, and 4 of Title I of ERISA relating to
participation and vesting, funding, and fiduciary responsibilities, respectively. In addition, the
Plan is not a tax-qualified plan under the Code, and thus the Plan and benefits paid hereunder are
not subject to certain rules which apply to benefits payable under such qualified plans, including
the manner in which a Participant’s or Beneficiary’s Plan benefits are subject to income tax.




               (2) Repeal of Code Section 401(a)(17). Notwithstanding any other provision of the
Plan to the contrary, if Code section 401(a)(17) is repealed and no similar or corresponding
provision is immediately enacted to replace it, then until further action by the Committee, if any,
the Covered Compensation and Benefit Percentages of each Participant shall be frozen as of the end
of the calendar year which includes the effective date of such repeal; provided, however, upon a
Change in Control this Section 3(a)(2) shall not apply to a Participant so long as such Participant
may incur a Covered Termination with respect to that Change in Control and shall not apply
thereafter to a Participant who incurs a Covered Termination with respect to that Change in
Control.



               (3) Participation Freeze. Notwithstanding the foregoing, only individuals who are
Eligible Employees on December 31, 2007 shall be entitled to participate in
the Plan. Accordingly, any individual who is hired on or after January 1, 2008, will not be
covered by the Plan.



6









 





          (b) Vesting.




               (1) General. Except as otherwise expressly provided herein, all benefits otherwise
payable under the Plan to or with respect to a Participant shall be forfeited if the Participant
has a Separation from Service before completing five (5) Years of Service.



               (2) Death or Disability. A Participant who dies or becomes Disabled while employed by
a Group Member shall be fully vested in his or her Retirement Benefit.



               (3) Automatic Acceleration of Vesting. If a Participant has a Covered Termination
under his or her KEESA, then immediately before such termination the Participant shall be
considered fully vested in his or her Retirement Benefit.



               (4) Other Forfeiture. Notwithstanding the foregoing provisions of this Section 3(b)
or the number of Years of Service completed or deemed completed, all benefits otherwise payable
under the Plan to or with respect to a Participant or former Participant shall be subject to
forfeiture to the extent provided in Section 6(b).



          (c) Benefit Service.




               (1) Death. An individual who ceases to be a Participant and terminates employment
from the Group by reason of death shall be considered to have completed a Year of Service in the
year of death for purposes of determining the Benefit Service earned by such individual, regardless
of the Hours of Service credited for such year.



               (2) Benefit Service Upon a Covered Termination. If a Participant has a Covered
Termination under his or her KEESA, then immediately before such termination the Participant shall
be credited with additional Years of Service for determining Benefit Service equal to the lesser of
(i) three (3) and (ii) the greater of (x) seven (7) minus the Benefit Service credited to such
Participant under the Plan, determined without regard to this Section 3(c)(2), as of the first day
of the Plan Year beginning immediately after such termination and (y) zero (0); provided, however,
the Benefit Percentage for each such additional year of service, if any, shall be determined based
upon what would be the Participant’s attained age in whole years as of January 1 of each calendar
year beginning after the date of the Covered Termination corresponding to such additional year of
service (e.g., if the Participant, date of birth March 3, 1947, incurs a Covered Termination in the
year 2000 and receives three (3) additional years of service hereunder, then the aggregate Benefit
Percentage for such years shall be 30% (9% + 9% + 12%). The Benefit Service provided for by this
Section 3(c)(2) shall be in addition to a Participant’s Benefit Service under the Plan determined
without regard to this Section 3(c)(2).



          (d) Service Credits.




               (1) General. Subject to other Plan provisions, a Participant’s Years of Service shall
be based upon the completion of 1,000 Hours of Service during a calendar year.



7









 





               (2) No Vesting Service Before Participation Date. No Year of Service completed before
the calendar year which includes an individual’s Participation Date shall be considered for
purposes of applying Section 3(b)(1).



               (3) Non-Duplication of Service Credit. In no event shall a Participant be credited
for more than one (1) Year of Service with respect to any one (1) calendar year. In the event
service credit for a period must be provided under the Plan by reason of applicable law (e.g.,
USERRA) and such credit duplicates service credit otherwise provided under the Plan, then the
service crediting provision which is most beneficial to the Participant under the circumstances
shall be applied but without duplication of service credit for the same period.



               (4) Leaves of Absence. In the sole discretion of the Committee, a Participant may be
granted service credit for a period of absence from active employment due to illness, personal
circumstances, or such other events as the Committee may authorize under the circumstances and in
such amount or manner of service credit as the Committee deems appropriate under the circumstances,
but in no event shall such service credit duplicate any such credit otherwise provided under the
Plan for the same period or extend beyond the date the Participant Separates from Service. Unless
otherwise expressly provided by the Committee, however, in no event shall a Participant earn
Benefit Service during the period of such absence.



               (5) Break in Service. Except as determined in the sole discretion of the Committee,
if a Participant incurs a Separation from Service before he or she has a nonforfeitable right to a
Retirement Benefit by reason of Section 3(b)(1) and thereafter returns to employment as an Eligible
Employee, all service credits earned prior to such termination shall be ignored and, if the
individual again becomes a Participant, the individual’s service credits under the Plan shall be
determined as if he or she had not been previously employed by any Group member.



               (6) Transfer. If an individual becomes a Participant and subsequently, and without a
Separation from Service, becomes employed as other than an Eligible Employee, then upon the
occurrence of such event the individual shall cease all active participation under the Plan (e.g.,
he or she will no longer accrue benefits under the Plan).



          (e) Disability.




               (1) General. This Section describes special service credit and other rules which
apply to a Participant who becomes Disabled before age sixty-five (65) and while he or she is an
Eligible Employee (i.e., a “Disabled Participant”). In no event shall a Participant be considered
Disabled until and unless he or she supplies all information and takes all acts (e.g., submits to
medical examinations) reasonably requested by the Administrator to establish the fact of his or her
Disability.



               (2) Credit for Benefit Service. A Disabled Participant shall receive credit for
Benefit Service during the Disability period. This service credit shall be determined, without
duplication of other service credit provided under the Plan for the same period, based upon the
complete whole years (with fractional years being rounded to the nearest whole year) which elapse
during the Disability period. The Disability period shall begin on the date of



8









 







Disability as determined by the Administrator, taking into account any applicable waiting
period (e.g., end of short-term disability period) prescribed by the Administrator for this
purpose, and shall end on the earliest of (i) the date the Participant is no longer Disabled or is
considered not to be Disabled, (ii) the date the Disabled Participant attains age sixty-five (65),
and (iii) the date of the Participant’s death.



               (3) Covered Compensation. Except as described in the immediately following paragraph,
a Participant’s Covered Compensation, determined as of the beginning of the Disability period,
shall not change during the Disability period, and if a Disabled Participant recovers from the
Disability before attaining age sixty-five (65) and returns to employment as an Eligible Employee,
Covered Compensation shall be determined as otherwise provided under the Plan and by assuming the
Participant’s (x) Compensation during the Disability period was equal to the Participant’s Final
Average Compensation as of the beginning of the Disability period and (y) Section 401(a)(17)
Compensation during the Disability period was equal to the Participant’s Section 401(a)(17)
Compensation as of the beginning of the Disability period.



          Notwithstanding the immediately preceding paragraph, a Disabled Participant’s Covered
Compensation shall be decreased during the Disability period if and to the extent such
Participant’s final average compensation or similar amount taken into account under the Pension
Plan (or any other tax-qualified defined benefit plan sponsored by a Group member) increases due to
the imputation of compensation, during the Disability period and by reason of such disability, for
purposes of determining retirement benefits under such plan. In such event, the Participant’s
Covered Compensation during the Disability period shall be decreased by the same amount by which
final average compensation under such other plan is so increased, and clause (y) of the immediately
preceding paragraph shall be applied by substituting the phrase “as of the end of the Disability
period” for the phrase “as of the beginning of the Disability period.”




               (4) Payment of Disability Benefit. A Disabled Participant shall be entitled to a
Retirement Benefit commencing as of the first day of the month next following the Participant’s
attainment of age sixty-five (65), even if such individual recovers from such Disability prior to
such date.



               (5) Death During the Disability Period. If a Disabled Participant dies during the
Disability period or the Disability ends by reason of attainment of age sixty-five (65) and the
Disabled Participant dies before benefits commence, a death benefit shall be paid after such
Disabled Participant’s death to the extent provided in Section 4.



               (6) Proof of Disability. The Administrator shall determine whether and when a
Participant is Disabled and may adopt such rules and procedures as it deems appropriate for this
purpose. Once a Participant is determined to be Disabled, the Administrator may require the
Participant to verify that he or she remains Disabled, and such verification may include requiring
the Participant to submit to one or more medical examinations. If a Participant fails to supply
information or take action as requested by the Administrator in order to determine whether the
Participant is or remains Disabled, the Participant shall not be considered Disabled or shall be
considered to have recovered from the Disability, as the case may be, except that in no event shall
benefits commence prior to the Participant’s age sixty-five (65).



9









 





          (f) Compensation.




               (1) General. Compensation, Final Average Compensation and Section 401(a)(17)
Compensation shall be determined solely with respect to such remuneration earned from and after a
Participant’s Benefit Service Date and during the period of employment as an Eligible Employee. In
the event a Participant is employed with a Group member before becoming an Eligible Employee or,
subject to the provisions of Section 3(d)(6), after ceasing to be an Eligible Employee, the
Administrator shall determine such compensation allocable to periods of such employment in each
capacity in such manner as it deems reasonable in its sole discretion under the circumstances
(e.g., allocation of MIP bonuses for the year in which an individual is promoted to an Eligible
Employee).



               (2) Determination. The amount of Compensation, Final Average Compensation and Section
401(a)(17) Compensation shall be as determined from the books and records of the employing Group
member and shall be determined on the basis of when such remuneration is paid to the Participant;
provided, however, items of remuneration or portions thereof may be determined on the basis of when
the item is earned (in which case the item or portion shall not be again counted when paid) by the
Participant if and to the extent the Administrator determines such treatment is appropriate under
the circumstances (e.g., including MIP bonuses earned during the final year of employment as
Compensation before such bonus is actually paid; including an amount deferred at the election of
the Participant as Compensation when it otherwise would have been paid but for such election).



     SECTION 4. Payments In The Event Of Death Before The Benefit Commencement Date. A pre-retirement
death benefit shall be payable under the same events, at the same time, in the same way and to the
same persons and in the same proportions, and subject to the same adjustments, terms and conditions
as provided for the pre-retirement death benefit payable under Section 4 of the SERP, but solely
with respect to the Pension Amount hereunder.



     SECTION 5. Payment Of Retirement Benefits. A Retirement Benefit shall be payable under the same
events, at the same time, in the same way and to the same persons and in the same proportions, and
subject to the same adjustments, terms and conditions as provided for the retirement benefit
payable under Section 5 of the SERP, but solely with respect to the Pension Amount hereunder.



     SECTION 6. Confidentiality, Covenants Not To Compete, And Non-Solicitation.



          (a) General. Each Eligible Employee acknowledges that as a key executive of the Company or
other Group member he or she has become familiar and will continue to be familiar with the trade
secrets, know-how, executive personnel, strategies, other confidential information and data of the
Group and its members. Each Eligible Employee further acknowledges that the financial security of
the Group and the Company’s shareholders depends in large part on the efforts of executives like
the Eligible Employee, and that a basic premise for the Plan is to compensate such individuals for
their efforts in causing the Group to grow and prosper, thereby helping to insure the Group’s
financial future for years well beyond the time the individual leaves. Therefore, in consideration
of the extension of the Plan to an Eligible Employee, he or she agrees that (i) after Termination
of Employment he or she shall not (directly




10









 




or indirectly), without the Company’s prior written
consent, use or disclose to any other person any confidential information or data concerning the
Company or other Group members or former Group members, and (ii) for a period of three (3) years
from Termination of Employment he or she shall not (directly or indirectly) and without the
Company’s prior written consent:





	 	(1)	 	own, manage, control, participate in, consult
with or render services of any kind for any concern which engages in a
business which is competitive with any business being conducted, or
contemplated being conducted, by the Group as of the date of
Termination of Employment;
	 
	 	(2)	 	become an employee or agent of any publicly
traded corporation or other entity, or any division or subsidiary of
such a corporation or entity, where more than 5% of such organization’s
business is in competition with any business being conducted, or
contemplated being conducted, by the Group as of the date of
Termination of Employment, unless the annual sales of such organization
do not exceed $40 million;
	 
	 	(3)	 	participate in any plan or attempt to acquire
the business or assets of the Group or control of the voting stock of
any member thereof, or in any manner interfere with the control of the
Company, whether by friendly or unfriendly means; or
	 
	 	(4)	 	induce or attempt to induce any individual to
leave the employ of the Company or other Group member or hire any such
individual who approaches him or her for employment.




If at the time of enforcement of the terms of this Section 6, a court shall hold that the duration,
scope or area of restriction stated herein are unreasonable under the circumstances then existing,
the Eligible Employee agrees that the maximum duration, scope or area reasonable under such
circumstances shall be substituted for the stated duration, scope, or area.




          (b) Forfeiture and Other Remedies. Upon any breach of the covenants described in this
Section, all benefits then due under the Plan (and all benefits which otherwise would be due under
the Plan in the future) to the Eligible Employee or his or her beneficiaries shall be forfeited.
The covenants described in this Section run in favor of and shall be enforceable by the Company or
its assigns. The Company shall be entitled to all legal and equitable remedies to prevent, cure
and compensate for a breach of the covenants described herein, without posting of bond, and all
such remedies shall be in addition to such forfeiture. By accepting coverage under the Plan, each
Eligible Employee acknowledges and agrees that his or her breach or breach of the covenants
described in this Section 6 will result
in irreparable harm to the Company. Therefore, to remedy or prevent such a breach the Company
shall be entitled to enjoin the Eligible Employee from taking or failing to take such actions as
will or which may be reasonably considered to cause such a breach, including an injunction to
prevent the Eligible Employee from breaching the terms of this Section 6.




11









 





     SECTION 7. Funding And Payment Of Benefits.



          (a) General. Except as expressly provided herein, the Plan is an unfunded deferred
compensation arrangement. No Group member shall establish or is required to establish any trust to
fund benefits provided under the Plan, and no such member shall establish or is required to
establish any type of earmarking or segregation of its assets to provide for such benefits. In the
event of default of a Group member’s obligations hereunder, each Participant and his or her
beneficiaries shall have no greater entitlements or security than does a general creditor of the
Group member.




          (b) Employer Company. Except as otherwise expressly provided herein, the Employer Company
shall pay or provide for the payment of benefits hereunder. If the Employer Company does not
timely pay such benefits, then, except as described in subsection (c) immediately following, the
sole recourse of the claimant Participant or Beneficiary is against such Employer Company and no
other member of the Group shall be responsible to pay or provide for the payment of such benefits
or liable for the nonpayment thereof.




          (c) Company Assumption of Liability. Under the following circumstances, the Company shall
assume and be responsible for the payment of benefits hereunder even though it is not the Employer
Company:





	 	(i)	 	the Employer Company is not participating in
the Plan as of the date benefits hereunder are scheduled to commence to
a Participant or his or her beneficiaries;
	 
	 	(ii)	 	the Employer Company does not timely pay or
provide for the payment of benefits hereunder and such failure is not
corrected within thirty (30) days; or
	 
	 	(iii)	 	the Participant has a Termination of
Employment due to a sale of the stock (or rights analogous to stock) or
assets of a Group member, and the Participant has earned a
non-forfeitable Retirement Benefit (determined without regard to the
forfeiture provision of Section 6(b) unless such section has been
actually enforced as to such individual) on or before the date of such
termination.




The Company’s obligation under paragraph (i) immediately preceding shall cease when the Employer
Company agrees to participate in the Plan. The Company’s obligation under
paragraph (ii) immediately preceding shall cease when the Employer Company is current on its
payment of benefits. The Company’s obligation under paragraph (iii) immediately preceding shall
not come into effect (or if previously effective, shall cease) as of the date the person who
purchased such stock or assets, or a person who controls such person, agrees in writing to assume
the liability for the benefits the Participant has then earned hereunder; provided, however, that
upon a Change in Control the Company, any person in control of the Company, and the Employer
Company if not the Company, shall be jointly and severally responsible for payment of benefits
hereunder regardless of the other provisions of this Section 7 and the assumption of
such liability
by another person shall not discharge the Company, any person in control of the Company, and such
Employer Company from liability hereunder.




12









 








          (d) Participation by Other Group Members. A member of the Group may join in this Plan by
adopting a written resolution of its board of directors, and delivering such resolution to the
Administrator. Any Group member, other than the Company, may end its participation under the Plan
by a written resolution of its board of directors delivered to the Committee, provided, however,
that no such resolution ending participation shall be effective until thirty (30) days after it is
received by the Administrator. By agreeing to join in the Plan, each Group member agrees to pay or
provide for the payment o£ benefits hereunder to those Participants and their beneficiaries with
respect to whom such member is the Employer Company. No such member, other than the Company, shall
have any power or authority to terminate, amend, administer, modify, or interpret the Plan, all
such powers being reserved to the Administrator and the Committee.




     SECTION 8. Default. Should the Employer Company (and the Company to the extent provided for in
Section 7(c)) fail to pay when due any benefit under the Plan to or with respect to a Participant
or Beneficiary and such failure to pay continues for a period of sixty (60) days from receipt of a
written notice of nonpayment from the affected Participant or Beneficiary, the Employer Company
(and the Company to the extent provided in Section 7(c)) shall be in default hereunder and shall
pay to the Participant or Beneficiary the benefits past due and the reasonable costs of collection
of any such amount, including reasonable attorney’s fees and costs; provided, however, if the
Administrator in good faith disputes the amount of such benefit due or whether a person is entitled
to such a benefit, then to the extent and duration of such a dispute the Employer Company (and the
Company to the extent provided for in Section 7(c)) shall not be considered in default hereunder;
provided further, however, a Participant for whom a KEESA becomes operative due to a Change in
Control, and regardless of whether such Participant incurs a Covered Termination, shall be entitled
to payment or reimbursement of such costs of collection as provided under Section 13(l).



     SECTION 9. Administration Of The Plan.



          (a) General. The Company, through its designated officers and agents, shall be the
Administrator and thereby handle the day-to-day administration of the Plan and such other
administrative duties as
are allocated to the Administrator under the Plan. All such administrative duties and powers shall
be performed by and rest in the Company’s Senior Vice President of Human Resources (or persons
designated by such Senior Vice President). Except as otherwise provided under the Plan, the
Administrator shall:





	 	(1)	 	determine the rights and benefits of
individuals and other persons under the Plan;
	 
	 	(2)	 	interpret, construe, and apply the provisions
of the Plan;
	 
	 	(3)	 	process and direct the payment of Plan
benefits;
	 
	 	(4)	 	adopt such forms as it deems appropriate or
desirable to administer the Plan and pay benefits thereunder; and




13









 






	 	(5)	 	adopt such rules and procedures as it deems
appropriate or desirable to administer the Plan.





          (b) Committee. The Committee shall exercise such powers as are allocated to it under the
Plan and shall be empowered to direct other persons as to Plan administration, and its directions
shall be followed to the extent consistent with the powers delegated to the Committee and not
otherwise contrary to the provisions of the Plan.




          (c) Discretion. In exercising their powers and duties under this Section, and their other
powers and duties granted under the Plan, the Committee and the Administrator and each member or
delegate thereof is granted such discretion as is appropriate or necessary to carry out such duties
and powers. This discretion necessarily follows from the fact that the Plan does not, and is not
intended to, prescribe all rules necessary to administer the Plan or anticipate all circumstances
or events which may arise in the course of such administration.




          (d) Indemnity. No member of the Committee or person acting on behalf of the Administrator
shall be subject to any liability with respect to the performance of his or her duties under the
Plan or a related document unless he or she acts fraudulently or in bad faith. The Company shall
indemnify and hold harmless the members of the Committee and the Company’s officers and employees,
and the officers and employees of another Group member, from any liability with respect to the
performance of their duties under the Plan, unless such duties were performed fraudulently or in
bad faith. Such indemnification shall cover any and all reasonable attorneys’ fees and expenses,
judgments, fines and amounts paid in settlement, but only to the extent such amounts are (i)
actually and reasonably incurred, (ii) not otherwise paid or reimbursable under an applicable
employer paid insurance policy, and (iii) not duplicative of other payments made or reimbursements
due by the Company or its affiliates under other indemnity agreements.




          (e) Code Section 409A. The Plan shall be administered, and the Administrator and the
Committee shall exercise their discretionary authority under the Plan, in a manner consistent with
Code section 409A and Treasury Regulations and other applicable guidance thereunder. Any
permissible discretion to accelerate or defer a Plan payment under such Regulations, the power
which to exercise is not otherwise described expressly in the Plan, shall be exercised by the
Committee. Any other discretion with respect to, or which directly or indirectly impact, the
application of Code section 409A, the exercise of which is not expressly lodged in the Committee,
shall be exercised by the Administrator. In the event the matter over which such discretion may be
exercised relates to a Committee member or a delegate of the Administrator, or such member or
delegate is otherwise unable to freely exercise such discretion, such member or delegate shall not
take part in the deliberations and decisions regarding that matter.




          (f) Use of Professional Services. The Administrator and the Committee may obtain the
services of such attorneys, accountants, record keepers or other persons as it deems appropriate,
any of whom may be the same persons who are providing services to the Company or other Group
member. In any case in which the Administrator and the Committee utilizes such services, it shall
retain exclusive discretionary authority and control over the administration and operation of the
Plan.




14









 









          (g) Communications. Requests, claims, appeals, and other communications related to the
Plan shall be in writing and shall be made by transmitting the same via the U.S. Mail to the
Company’s Senior Vice President of Human Resources, at the Company’s corporate headquarters
address.




     SECTION 10. Effect of KEESA. If a Participant incurs a Covered Termination, then as or with
respect to that Participant:




	 	(i)	 	notwithstanding the provisions of Section 6,
the scope or duration (or both) of such Participant’s covenants under
Section 6 shall be no greater or longer than similar covenants provided
for in such Participant’s KEESA and, to the extent there are no such
similar covenants in such Participant’s KEESA, then Section 6 shall be
void and of no force and effect;
	 
	 	(ii)	 	if the Participant is not fully vested in his
or her accrued benefit under the Pension Plan when he or she so
terminates employment, such Participant’s Pension Amount as of the
Benefit Commencement Date shall be increased by the present value of
such non-vested accrued benefit; such present value shall be determined
(x) as of the Benefit Commencement Date, (y) by using the amount of
such non-vested accrued benefit payable as of the Benefit Commencement
Date as calculated under the terms of the Pension Plan and by assuming
the Participant was eligible to
receive such non-vested accrued benefit under the Pension Plan on and
after the attainment of age fifty-five (55), and (z) by using UP 84
mortality and seven percent (7%) interest; and
	 
	 	(iii)	 	in the case of any conflict between the terms
and provisions of this Plan and the terms and provisions of such
Participant’s KEESA, the terms of such Participant’s KEESA shall
control to the extent more beneficial to such Participant, and the
obligations of the Company under such KEESA shall be in addition to any
of its obligations under the Plan.





     SECTION 11. Amendment Or Termination.



          (a) General. This Plan may be terminated or amended, in whole or in part, at any time by
written resolution of the Board of Directors of the Company. Any such action may apply to the Plan
as a whole, or any individual Participant or group of Participants. Except as provided in Section
11(b) and (c), any such action may reduce or eliminate (retroactively or prospectively, or both)
any benefits under the Plan that otherwise would be payable but for such action.




          (b) Limitation on Power to Amend or Terminate.




               (1) Vested Participants. As to any Participant who has earned a non-forfeitable
Retirement Benefit (determined without regard to Section 6) before the date the Plan



15









 







is amended or
terminated (or, if later, before the date such action is effective), no such amendment or
termination shall (without the specific written consent of the Participant):




	 	(i)	 	reduce the Retirement Benefit earned by the
Participant;
	 
	 	(ii)	 	reduce the amount of Plan benefits then being
paid to a Participant or change the form in which such benefits are
being paid; or
	 
	 	(iii)	 	terminate, amend, or otherwise change the
liability of the Company, Employer Company, or other person to pay or
provide for the payment of Retirement Benefits protected under clauses
(i) and (ii) immediately preceding.





               (2) Beneficiaries. As to any former Participant who has died before the date the Plan
is amended or terminated (or, if later, before the date such action is effective), no such
amendment or termination shall (without the specific written consent of such Participant’s
Beneficiary):




	 	(i)	 	reduce the amount of Plan benefits to which
such Beneficiary is entitled or change the form in which benefits are
payable; or
	 
	 	(ii)	 	terminate, amend, or otherwise change the
liability of the Company, Employer Company, or other person to pay or
provide
for the payment of benefits protected under clause (i) immediately
preceding.





          (c) Change in Control. In addition to the limitations described in Section 11(b), upon a
Change in Control for which a Participant’s KEESA becomes operative and under which a Covered
Termination has or may occur, then without the specific written consent of the Participant (or
Beneficiary in the event of the Participant’s death), the Plan as in existence immediately prior to
the Change in Control may not be (directly or indirectly) terminated, amended, or otherwise changed
in any respect during the three year period beginning with the date of the Change in Control, but
only with respect to such individual. The prohibition herein described shall apply to any action
which affects or is intended to affect the terms and provisions of the Plan as then in effect
during such three year period, regardless of when made or effective.




          (d) Continuation of Plan Provisions. To the extent that any Plan benefits, and rights and
obligations allocable thereto, are protected under Section 11(b) and (c), then as to the persons
described in Section 11(b) and (c) the Plan shall continue in force and effect, as if no such
amendment or termination had occurred, until such benefits are fully paid or fully provided for to
such persons.




     SECTION 12. Claims.



          (a) Filing Claims. A Participant or Beneficiary (or a person who in good faith believes he
or she is a Participant or Beneficiary, i.e., a “claimant”) who believes he or she has been wrongly
denied benefits under the Plan may file a written claim for benefits with the
Administrator.
Although no particular form of written claim is required, no such claim shall be considered unless
it provides a reasonably coherent explanation of the claimant’s position.




16









 





          (b) Decision on Claim. The Administrator shall in writing approve or deny the claim within
sixty (60) days of receipt, provided that such sixty (60) day period may be extended for reasonable
cause by notifying the claimant. If the claim is denied, in whole or in part, the Administrator
shall provide notice in writing to the claimant, setting forth the following:





	 	(1)	 	the specific reason or reasons for the denial;
	 
	 	(2)	 	a specific reference to the pertinent Plan
provisions on which the denial is based;
	 
	 	(3)	 	a description of any additional material or
information necessary for the claimant to perfect the claim and an
explanation of why such material is necessary; and
	 
	 	(4)	 	the steps to be taken if the claimant wishes to
appeal the decision to the Committee.





          (c) Appeal of Denied Claim.




               (1) Filing Appeals. A claimant whose claim has been denied in whole or in part may
appeal such denial to the Committee by filing a written appeal with the Administrator within sixty
(60) days of the date of the denial. A decision of the Administrator which is not appealed within
the time herein provided shall be final and conclusive as to any matter which was presented to the
Administrator.



               (2) Rights on Appeal. A claimant (or a claimant’s duly authorized representative) who
appeals the Administrator’s decision shall, for the purpose of preparing such appeal, have the
right to review any pertinent Plan documents, and submit issues and comments in writing to the
Committee.



          (d) Decision by Appeals Committee. The Committee shall make a final and full review of any
properly appealed decision of the Administrator within sixty (60) days after receipt of the appeal,
provided that such period may be extended for reasonable cause by notifying the claimant. The
Committee’s decision shall be in writing and shall include specific reasons for its decisions and
specific references to the pertinent Plan provisions on which its decision is based.




     SECTION 13. Miscellaneous.



          (a) Non-Alienation.. Except as otherwise provided under the Plan or as required under
applicable law, unless otherwise determined by the Administrator, no right or benefit under this
Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, or charge, and any attempt to anticipate, alienate, sell, transfer, assign,
pledge, encumber, or charge the same shall be void, and no such right or benefit shall be in any
manner liable for or subject to the debts, contracts, liabilities, engagements, or torts of any
person entitled to such right or benefit, and no such right or benefit shall be subject to
garnishment, attachment, execution, or levy of any kind.




17









 





          (b) Employer’s Rights. The right of a Group member to discipline or discharge employees or
to exercise rights related to the tenure of employment shall not be adversely affected in any
manner by reason of the existence of the Plan or any action hereunder.




          (c) Interpretation. Section and subsection headings are for convenient reference only and
shall not be deemed to be part of the substance of this instrument or in any way to enlarge or
limit the contents of any
Section or subsection. Masculine gender shall include the feminine, and vice versa, and singular
shall include the plural, and vice versa, unless the context clearly requires otherwise.




          (d) Withholding of Taxes. All benefits earned under the Plan or the payment of such
benefits, as the case may be, shall be subject to withholding for federal, state, local and other
taxes as required by law. If and to the extent any such withholding is required before such
benefits are paid to the Participant or Beneficiary, such withholdings shall be made from amounts
otherwise payable to such person by a Group member (e.g., salary). If no such other amounts are
available to satisfy such withholdings, the Company may reduce the Participant’s Retirement Benefit
by the amount needed to pay the Participant’s portion of such tax, plus, with respect to a
distribution for FICA taxes, an amount equal to the withholding taxes due under federal, state or
local law resulting from the payment of such FICA tax, and an additional amount to pay the
additional income tax at source on wages attributable to the pyramiding of the section 3401 wages
and taxes, but no greater than the aggregate of the FICA amount and the income tax withholding
related to such FICA amount.




          (e) Offset for Amounts Due. A Participant’s Retirement Benefit may be reduced by one or
more offsets to repay any amounts then due and owing by the Participant to a Group member, unless
another means of repayment is agreed to by the Administrator. Except for the right to immediate
offset by reduction of the vested Pension Amount for an amount up to $5,000, or such higher amount
as allowed in Treasury Regulations under Code section 409A or other applicable guidance, no such
offset shall be made before an amount is scheduled to be paid to the Participant or Beneficiary and
the amount then offset shall not exceed the amount that would be then otherwise paid.




          (f) Computational Errors. In the event mathematical, accounting, actuarial or other errors
are made in administration of the Plan due to mistakes of facts, the Administrator may make
equitable adjustments, which may be retroactive, to correct such errors. Such adjustments shall be
conclusive and binding on all Participants and Beneficiaries.




     (g) Requirement of Proof. In discharging their duties and responsibilities under the Plan,
the Administrator and the Committee may require proof of any matter concerning this Plan, and no
person shall acquire any rights or be entitled to receive any benefits under this Plan until such
proof is furnished.



     (h) Tax Consequences. Neither the Company nor any other Group member represents or
guarantees that any particular federal, foreign, state or local income, payroll, or other tax
consequence will result from participation in this Plan or payment of benefits under the Plan.



18









 





     (i) Communications The Administrator shall prescribe the forms of communication, including forms for benefit
application and the like, with respect to the Plan as it deems appropriate. Any such communication
and assent or consent thereto may be handled by electronic means.



     (j) Not Compensation Under Other Benefit Plans. No amounts paid or payable to a
Participant under the Plan shall be deemed to be salary or compensation for purposes of any other
employee benefit plan of the Company or any other Group member except as and to the extent
otherwise specifically provided in such other plan.



          (k) Choice of Law. To the extent not preempted by ERISA or any other federal statute, the
construction and interpretation of the Plan shall be governed by the laws of the State of
Minnesota, without reference to conflict of law principles thereof.




          (l) Savings Clause. Should any valid federal or state law or final determination of any
agency or court of competent jurisdiction affect any provision of this Plan, the Plan provisions
not affected by such determination shall continue in full force and effect.




          (m) Change in Control. A Participant for whom a KEESA becomes operative due to a Change in
Control, and regardless of whether such Participant incurs a Covered Termination, shall be entitled
to adjudicate any dispute regarding his or her benefits or rights and entitlements under the Plan,
after compliance to the extent necessary with the claim procedures under Section 12, in the forums
and venues as provided in Section 22 of the KEESA, and shall be entitled to payment or
reimbursement of costs and expenses related to such adjudication as provided in Section 15 of the
KEESA.




     SECTION 14. Transition Rules.



          (a) General. Except as described in this Section, this Plan document shall govern when and
how Plan benefits are payable with respect to individuals who are Participants on or after January
1, 2009. For the period that began on January 1, 2005 and ended December 31, 2008, the Plan as in
effect on December 31, 2004 governed the rights and obligations of the Company and Participants,
except as modified by the Administrator in its discretion so that the Plan and its operations were
in good faith compliance with Code section 409A.




          (b) 2004 Vested Participants Benefits. The Plan document in effect as of December 31, 2004
(the “2004 Plan”) shall govern when and how then vested Plan benefits are payable, including the
elections available or discretion granted to choose or affect the form or commencement date of such
benefits. In determining such vested
Plan benefits, the Pension Amount as of such date shall be determined as if the Participant had a
Separation from Service on the earlier of (i) December 31, 2004 and (ii) the actual date of such
event. The Pension Amount as so determined shall be increased by the adjustment factor for the
period from the first of the month next following the earlier of such dates to the annuity
commencement date, and shall be converted into the annuity forms available for payment, all as
provided for in the 2004 Plan.




19









 





          (c) Excess. The excess, if any, of the total Plan benefit payable to or with respect to a
Participant expressed as the Monthly Installment over the Plan benefit so payable expressed as the
Monthly Installment and described in subsection (b) immediately preceding shall be subject to this
Plan document.




          The undersigned, by the authority of the Board of Directors of Pentair, Inc., does hereby
approve the form and content of this amended and restated Plan document.




	 	 	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 
	 	 

	 	 






20









 





SCHEDULE 1




	 	 	 
	Items Included	 	Items Excluded
	 
	 	 
	Base salary or wages, including
such salary or wages deferred
at the election of an
individual under the Pentair,
Inc. Non-Qualified Deferred
Compensation Plan


401(k) plan before-tax and
after-tax employee
contributions



Section 125 plan (flexible
benefit plan) pre-tax employee
contributions



Pentair, Inc. Employee Stock
Purchase and Bonus Plan
employer bonus contributions


Pentair, Inc. Management
Incentive Plan bonus, including
such bonus deferred at the
election of an individual under
the Pentair, Inc. Non-Qualified
Deferred Compensation Plan


Holiday pay


Sick leave pay


Bereavement pay


Jury duty pay


Military pay 


Gain-sharing payments


Profit-sharing payments


Short-term disability benefits


Perquisites

	 	Cash payments made and property or rights
in property other than cash granted under
or pursuant to the Pentair Omnibus Stock
Incentive Plan


Special awards under the Pentair, Inc.

Management Incentive Plan


Severance pay


Moving expense reimbursements


Employee business expense reimbursements


Tuition reimbursement


Adoption assistance payments


Computer hardware and software purchase
reimbursements


Special cash awards


Foreign duty pay enhancements


Except as expressly provided in the
column immediately to the left, amounts
contributed to (e.g., deferred salary) or
received under or pursuant to
non-qualified deferred compensation
arrangements including, but not limited
to, the Pentair, Inc. Non-Qualified
Deferred Compensation Plan



Except as expressly provided in the
column immediately to the left, all
contributions (other than after-tax
employee contributions) to and all
benefits received under a tax-qualified
plan