Document:

<PAGE>   1

                                  EXHIBIT 10.3

                                  PENTAIR, INC.

                                RESTORATION PLAN

                AS AMENDED AND RESTATED EFFECTIVE AUGUST 23, 2000

<PAGE>   2
                                  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
Termination of Employment 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.

         (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.
<TABLE>
<CAPTION>
           Attained Age in Whole Years
            at Beginning of Relevant
             Year of Benefit Service                                       Percentage
             -----------------------                                       ----------
<S>                                                                        <C>
                    < 25                                                        4%
                > 25 and < 35                                                 5.5%
                -
                > 35 and < 45                                                   7%
                -
                > 45 and < 55                                                   9%
                -
                    > 55                                                       12%
                    -
</TABLE>

                                      -1-
<PAGE>   3
         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:
<TABLE>
<CAPTION>
       Year of Benefit Service              Percentage
       -----------------------              ----------
<S>                               <C>       <C>
                 1999                             7%
      2000 - 2009, inclusive                     90%
                 2010                            12%
                                               -----
                                  Total         109%
</TABLE>

         (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.

         (10) "COMMITTEE" is the Compensation and Human Resources Committee of
the Board of Directors of the Company.

         (11) "COMPANY" is Pentair, Inc., a Minnesota corporation.

         (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 Normal Form of Benefit, 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.

         (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 sickness or injury, other than an injury which is self-induced,
which would entitle the Participant to permanent and total disability benefits
under the Company's long-term disability plan (regardless of whether the
Participant is covered by such plan).

         (17) "EFFECTIVE DATE" of the Plan is January 1, 1999; the effective
date of this amended and restated Plan document is August 23, 2000.

                                      -2-
<PAGE>   4
         (18) "ELIGIBLE EMPLOYEE" is an individual who is an eligible employee
under the SERP.

         (19) "EMPLOYER COMPANY" is the Group member which employs a Participant
as of the date the Participant has a Termination of Employment.

         (20) "ERISA" is the Employee Retirement Income Security Act of 1974, as
amended.

         (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
calendar year which ends coincident with or immediately preceding the date the
Participant has a Termination of Employment or otherwise ceases to be an
Eligible Employee, whichever occurs first, 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 Termination of
Employment 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.

         (22) "GROUP" is the Company and any other corporation, business trust,
partnership, joint venture, limited liability company, or other legal entity, in
which the Company owns (directly or indirectly) fifty percent (50%) or more of
the voting stock or rights analogous to voting stock. Any such other
corporation, business trust, partnership, joint venture, limited liability
company, or other legal entity shall be considered a member of the Group only
for the period such ownership exists.

         (23) "HOUR OF SERVICE" has the meaning provided in Section 3(d)(1).

         (24) "JOINT AND SURVIVOR ANNUITY" is a monthly annuity (rounded to the
nearest whole dollar amount) commencing as of the Participant's Benefit
Commencement Date, which is the actuarial equivalent (determined by applying the
factors set forth in Table 2 of the SERP) of the Participant's Normal Form of
Benefit commencing as of the same date, under which the last monthly payment is
made for the month in which the Participant dies or, if the Participant is
survived by the Spouse to whom the Participant was married on the Benefit
Commencement Date, the month in which such surviving Spouse dies, and under
which the monthly benefit payable to such Spouse surviving is equal to the
monthly benefit payable during the life of the Participant.

         (25) "KEESA" is the Key Executive Employment and Severance Agreement
between the Company and key executives, as approved by the Company's board of
directors effective August 23, 2000.

         (26) "NORMAL FORM OF BENEFIT" is a monthly annuity, commencing as of
the Participant's Benefit Commencement Date, payable for a term certain of one
hundred eighty (180) consecutive

                                      -3-
<PAGE>   5
months, and shall be determined by dividing the Participant's Pension Amount by
the Conversion Factor, with such monthly annuity rounded to the nearest whole
dollar amount.

         (27) "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 and Termination of Employment for a reason other than death;
provided, however, if the individual has a non-forfeitable right to a Retirement
Benefit as of the date he or she has such a Termination of Employment
(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).

         (28) "PARTICIPATION DATE" is an Eligible Employee's participation date
under the SERP.

         (29) "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.

         (30) "PENSION PLAN" is the Pentair, Inc. Pension Plan.

         (31) "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.

         (32) "RETIREMENT BENEFIT" is the Plan monthly retirement benefit
payable under the Normal Form of Benefit or the Joint and Survivor Annuity.

         (33) "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) (or any
successor provision thereto). 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.

         (34) "SERP" is the Pentair, Inc. 1999 Supplemental Executive Retirement
Plan as amended and restated effective August 23, 2000, but without regard to
Appendix A thereto. A later amendment to such plan shall not be considered
hereunder (i.e., references herein to the SERP shall be to such plan as in
effect before the amendment) unless and until such amendment is specifically
made applicable to the Plan by the Committee.

         (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.

                                      -4-
<PAGE>   6
         (36) "TERMINATION OF EMPLOYMENT" is any event by which there is no
longer an employer-employee relationship between any Group member and an
individual, including such termination caused by the individual's retirement,
resignation, dismissal, death, or Disability; provided, however, in the event of
Disability for purposes of the Plan the date of Termination of Employment shall
be as determined under Section 3(e).

         (37) "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.

         (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 Termination of
Employment before completing five (5) Years of Service.

                  (2) Death or Disability. A Participant who incurs a
Termination of Employment by reason of his or her death or Disability shall be
considered to have completed five (5) Years of Service, immediately before such
event, for purposes of applying paragraph (1) immediately preceding.

                                      -5-
<PAGE>   7
                  (3) Automatic Acceleration of Vesting. If a Participant has
entered into a KEESA and such Participant incurs a Covered Termination, then
immediately before such termination the Participant shall be considered to have
completed five (5) Years of Service for purposes of applying paragraph (1)
immediately preceding.

                  (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 incurs a Termination of Employment 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 entered into a KEESA and such Participant incurs a Covered
Termination, 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. For this purpose an 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.

                                      -6-
<PAGE>   8
                  (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. 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 Termination of Employment
before he or she has a nonforfeitable right to a Retirement Benefit by reason of
Section 3(b)(1) and thereafter returns to employment with a Group member, 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 Termination of Employment, 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). To the extent permitted without causing
the Plan to be outside the provisions of ERISA section 202(1), such an
individual shall continue to be covered by the Plan with respect to determining
his or her vesting rights and for purposes of applying Plan provisions related
to the payment of nonforfeitable benefits, except (i) such an individual may not
elect a delayed Benefit Commencement Date and (ii) the Adjustment Factor shall
be determined as if the Participant had incurred a Termination of Employment as
of the date he or she becomes employed as other than an Eligible Employee. If
such continued treatment of the individual would cause the Plan to be outside
the provisions of ERISA section 202(1), or the Committee in its sole discretion
determines that such continuation may have that result, then notwithstanding any
other Plan provisions (i) if the individual had a non-forfeitable right
(determined without regard to Section (6)(b) unless such section has been
actually enforced as to such individual) to a Retirement Benefit as of the date
of such transfer, the Pension Amount (determined by applying an Adjustment
Factor of one (1)) shall be immediately paid to the individual in a lump sum;
provided, however, the Committee, in its sole discretion, may direct that such
Pension Amount immediately commence to be paid to the individual in the Normal
Form of

                                      -7-
<PAGE>   9
Benefit; and (ii) if the individual had no such non-forfeitable right, he or she
shall be treated as described in the last sentence of the first paragraph of
Section 3(a)(1).

         (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
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 earlier 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), (iii) the
date of the Participant's death, and (iv) if the Participant elects to receive a
Retirement Benefit before the dates described in clauses (i), (ii) and (iii)
immediately preceding, the end of the calendar month immediately preceding the
Benefit Commencement Date. Except as otherwise inconsistent with other Sections
or parts of the Plan and solely for determining whether a Participant has
incurred a Termination of Employment under the Plan (e.g., determining when a
Participant is entitled to commence receiving the Retirement Benefit), a
Participant shall not be considered to have incurred a Termination of Employment
during the Disability period.

                  (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."

                                      -8-
<PAGE>   10
                  (4) Recovery from Disability. If a Disabled Participant
recovers from the Disability prior to age sixty-five (65) and the Participant
does not return to employment with the Group, he or she shall be entitled to
Retirement Benefits in accordance with the other terms and provisions of the
Plan as modified by the provisions of this Section 3(e). If the Disabled
Participant recovers from the Disability prior to age sixty-five (65) and the
Participant returns to employment with a Group member as an Eligible Employee,
he or she shall be entitled to a Retirement Benefit in accordance with the terms
and provisions of the Plan as modified by the provisions of this Section 3(e),
and by taking into account the Participant's service and other relevant factors
after he or she returns to such employment. If the Disabled Participant does not
recover from the Disability prior to age sixty-five (65), he or she shall be
entitled to a Retirement Benefit commencing as of the first day of the month
after attaining such age; provided, however, in that event the Disabled
Participant may not elect a delayed Benefit Commencement Date.

                  (5) Death During the Disability Period. If a Disabled
Participant dies during the Disability period, 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.

         (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).

                                      -9-
<PAGE>   11
                  (3) Less Than Five Years of Service. For purposes of
determining Final Average Compensation, 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).

         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 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;

                                      -10-
<PAGE>   12
         (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.

         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:

                                      -11-
<PAGE>   13
         (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.

         (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 of
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

                                      -12-
<PAGE>   14
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(g).

         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 Vice President of Human Resources (or persons designated by such 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

         (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) 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.

         SECTION 10. EFFECT OF KEESA. If a Participant has entered into a KEESA
and such 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;

                                      -13-
<PAGE>   15
         (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 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

                                      -14-
<PAGE>   16
         (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.

         (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.

                                      -15-
<PAGE>   17
                  (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) 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.

         (b) 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.

         (c) 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, and to the extent the
Group member pays such withholdings, then notwithstanding the provision of
Section 5 the withholdings so paid by the Group member (with reasonable interest
thereon as determined by the Administrator) may be offset against benefits
otherwise payable under the Plan.

         (d) 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.

         (e) 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.

         (f) 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.

         (g) 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

                                      -16-
<PAGE>   18
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.

         (h) Application of Amendment. This amended and restated Plan document
applies with respect to individuals who are Participants on or after August 23,
2000.

                                      -17-
<PAGE>   19
         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:
      ------------------------         -----------------------------------------
                                       Louis L. Ainsworth
                                       Senior Vice President and General Counsel
                                       of Pentair, Inc.

         The undersigned, by the authority of the Board of Directors of Pentair,
Inc., does hereby execute the foregoing document for and on behalf of Pentair,
Inc. effective as of August 23, 2000.

                                       PENTAIR, INC.

Dated:                                 By:
                                          --------------------------------------
                                          Its:
                                              ----------------------------------

                                      -18-

<PAGE>   20
                                   SCHEDULE 1

                                 ITEMS INCLUDED

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

                                 ITEMS EXCLUDED

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

                                                 Effective as of August 23, 2000

<PAGE>   21
                                TABLE OF CONTENTS
<TABLE>
<S>                                                                                                               <C>
1.       NAME OF PLAN.............................................................................................1

2.       GENERAL DEFINITIONS......................................................................................1

3.       PARTICIPATION, VESTING AND BENEFIT SERVICE, AND RULES GOVERNING
         THE CREDITING OF SERVICE, DISABILITY AND THE DETERMINATION OF
         COMPENSATION AND FINAL AVERAGE COMPENSATION..............................................................5

         (a)      Participation...................................................................................5
         (b)      Vesting.........................................................................................6
         (c)      Benefit Service.................................................................................6
         (d)      Service Credits.................................................................................6
         (e)      Disability......................................................................................8
         (f)      Compensation....................................................................................9

4.       PAYMENTS IN THE EVENT OF DEATH BEFORE THE BENEFIT COMMENCEMENT DATE.....................................10

5.       PAYMENT OF RETIREMENT BENEFITS..........................................................................10

6.       CONFIDENTIALITY, COVENANTS NOT TO COMPETE, AND NON-SOLICITATION.........................................10

         (a)      General........................................................................................10
         (b)      Forfeiture and Other Remedies..................................................................11

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

8.       DEFAULT.................................................................................................13

9.       ADMINISTRATION OF THE PLAN..............................................................................13

         (a)      General........................................................................................13
         (b)      Committee......................................................................................14
         (c)      Indemnity......................................................................................14

10.      EFFECT OF KEESA.........................................................................................14

11.      AMENDMENT OR TERMINATION................................................................................14

         (a)      General........................................................................................14
</TABLE>

<PAGE>   22
<TABLE>
<S>                                                                                                              <C>

         (b)      Limitation on Power to Amend or Terminate......................................................15
         (c)      Change in Control..............................................................................15
         (d)      Continuation of Plan Provisions................................................................15

12.      CLAIMS..................................................................................................16

         (a)      Filing Claims..................................................................................16
         (b)      Decision on Claim..............................................................................16
         (c)      Appeal of Denied Claim.........................................................................16
         (d)      Decision by Appeals Committee..................................................................16

13.      MISCELLANEOUS...........................................................................................16

         (a)      Employer's Rights..............................................................................16
         (b)      Interpretation.................................................................................16
         (c)      Withholding of Taxes...........................................................................17
         (d)      Computational Errors...........................................................................17
         (e)      Choice of Law..................................................................................17
         (f)      Savings Clause.................................................................................17
         (g)      Change in Control..............................................................................17
         (h)      Application of Amendment.......................................................................17
</TABLE>

SCHEDULE 1<PAGE>   1
                                  EXHIBIT 10.4

                      FIRST AMENDMENT TO THE PENTAIR, INC.
                          OMNIBUS STOCK INCENTIVE PLAN
                             AS AMENDED AND RESTATED
                           EFFECTIVE FEBRUARY 14, 1996

         The Pentair, Inc. Omnibus Stock Incentive Plan as amended and restated
effective February 14, 1996 (the "Plan") is hereby amended effective August 23,
2000, as follows:

         1.       Section 7.3 of the Omnibus Plan is deleted in its entirety and
the following substituted therefor:

                  7.3 CHANGE IN CONTROL. (a) Definitions. Unless the context
         requires otherwise, when capitalized the terms listed below shall have
         the following meanings when used in this or any other section of the
         Plan:

                  (1) "CHANGE IN CONTROL" is a change in control of Pentair, as
                      that term is defined in the KEESA.

                  (2) "KEESA" is the Key Executive Employment and Severance
                      Agreement between Pentair and key executives, as approved
                      by the Board effective August 23, 2000.

                  (b) Treatment of Options. Upon the occurrence of a Change in
         Control, all Options granted to a Participant who is then employed by
         Pentair or an Affiliate shall, to the extent not then vested or
         exercised, become fully vested and immediately exercisable without
         regard to the terms and conditions attached to such Options at the time
         of grant. To the extent such Options are then exercised under
         circumstances which would otherwise result in a grant of reload options
         to the Participant, no such reload options will be granted.

                  (c) Treatment of Restricted Stock. Upon the occurrence of a
         Change in Control the restrictions then applicable to all outstanding
         shares of Restricted Stock awarded under the Plan shall automatically
         lapse. If on the Change in Control date any dividends declared with
         respect to such Restricted Stock have not been paid to the Participant,
         then all such amounts shall be paid within ten (10) days of the Change
         in Control date.

                  (d) Treatment of Rights to Restricted Stock. Upon the
         occurrence of a Change in Control, all Rights to Restricted Stock shall
         be fully and immediately vested and the participant shall be paid
         within ten (10) days the cash value of the shares of Stock which
         otherwise would have been issued based on the Fair Market Value of the
         Stock on the Change in Control date, together with any then unpaid
         dividends which have been declared on the Stock subject to the award of
         Rights to Restricted Stock.

<PAGE>   2

                  (e)      ICUs. Outstanding ICUs shall be valued and shall be
         paid in cash within ten (10) days of the Change in Control date, as
         follows:

                  (i)      one-third of the ICUs awarded less than one (1) year
                           prior to the Change in Control date shall be paid at
                           a value per ICU which shall be calculated assuming
                           that target corporate performance goals for the
                           applicable Incentive Period have been met;

                  (ii)     two-thirds of the ICUs awarded one (1) but less than
                           two (2) years prior to the Change in Control date
                           shall be paid at a value per ICU calculated on the
                           basis of the value of such ICUs as of the end of the
                           fiscal year immediately preceding the fiscal year in
                           which the Change of Control occurs;

                  (iii)    all of the ICUs awarded two (2) or more years prior
                           to the Change in Control date shall be paid at a
                           value per ICU calculated on the basis of the value of
                           such ICUs as of the end of the fiscal year
                           immediately preceding the fiscal year in which the
                           Change of Control occurs.

                  (f)      Performance Shares. Upon the occurrence of a Change
         in Control the restrictions then applicable to all outstanding
         Performance Shares shall lapse and any dividends declared with respect
         to such shares which have not been paid shall be paid within ten (10)
         days of the Change in Control date.

                  (g)      Performance Units. Outstanding Performance Units
         shall be valued by assuming all performance targets for the applicable
         Performance Period have been fully met and shall be paid as cash within
         ten (10) days of the Change in Control date, as follows:

                  (i)      one-third of the Performance Units granted less than
                           one (1) year prior to the Change in Control date
                           shall be paid;

                  (ii)     two-thirds of the Performance Units granted one (1)
                           but less than two (2) years prior to the Change in
                           Control date shall be paid;

                  (iii)    all of the Performance Units granted two (2) or more
                           years prior to the Change in Control date shall be
                           paid.

                  (h)      Participants Covered under a KEESA. The provisions of
         this Section 7.3 shall also apply to a Participant who terminates
         employment before a Change in Control if the Participant has entered
         into a KEESA and is entitled to benefits thereunder pursuant to Section
         2(b) of the KEESA.

                  (i)      Governing Documents. In the case of any conflict
         between the provisions of this Section 7.3 and any other provision of
         the Plan, this Section 7.3 will control. In the case of any conflict
         between the terms of this Plan and the terms and provisions of a
         Participant's KEESA, the terms of such KEESA shall control to

                                      -2-
<PAGE>   3

         the extent more beneficial to such Participant, and the obligations of
         Pentair under such KEESA shall be in addition to any of its obligations
         under the Plan.

         2. This amended Section 7.3 applies to only those individuals who are
Participants under the Plan on or after August 23, 2000.

                              --------------------

      The undersigned, by the authority of the Board of Directors of Pentair,
Inc., does hereby approve the form and content of this amendment to the Omnibus
Plan.

Dated:
      -----------------------------    -----------------------------------------
                                       Louis L. Ainsworth
                                       Senior Vice President and General Counsel
                                       of Pentair, Inc.

      The undersigned, by the authority of the Board of Directors of Pentair,
Inc., does hereby execute the foregoing document for and on behalf of Pentair,
Inc. effective as of August 23, 2000.

                                    PENTAIR, INC.

Dated:                                 By:
      -----------------------------       --------------------------------------
                                       Its:
                                           -------------------------------------

                                      -3-

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