UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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Pentair, Inc.

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PENTAIR, INC.

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 29, 2010

To our Shareholders:

     Our Annual Meeting of Shareholders will be held at the Thrivent Financial Auditorium, 625 4th Avenue South, Minneapolis, Minnesota, on Thursday, April 29, 2010, at 10:00 a.m., for the following purposes:

	1.		to elect four directors;
	2.		to amend the Pentair, Inc. 2008 Omnibus Stock Incentive Plan to increase the number of shares available for grant;
	3.		to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2010;

and to transact such other business as may properly come before the Annual Meeting or any adjournment of the Annual Meeting. We are not aware of any items of other business to be presented at the Annual Meeting.

     The Board of Directors has fixed the close of business on March 1, 2010 as the record date for determining the shareholders entitled to vote at the Annual Meeting. Accordingly, you are only entitled to vote if you were a shareholder of record at the close of business on that date. Our transfer books will not be closed.

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to Be Held on April 29, 2010: The Pentair, Inc. proxy statement for the 2010 Annual Meeting of Shareholders and the 2009 Annual Report to Shareholders are available at https://materials.proxyvote.com/709631.

By Order of the Board of Directors

Angela D. Lageson, Secretary

Minneapolis, Minnesota
March 23, 2010

IMPORTANT: Your vote is very important. To legally hold an Annual Meeting, a majority of the outstanding shares must be in attendance. We encourage you to vote your proxy as soon as possible. You may vote by Internet or telephone as described in the voting instructions on the proxy; or date, sign and return the proxy in the enclosed envelope. You may vote in person at the Annual Meeting even if you submit your proxy by Internet, phone or mail.

Proxy Statement for the

Annual Meeting of Shareholders of

PENTAIR, INC.

To Be Held on April 29, 2010

TABLE OF CONTENTS

		Page
Proxy Statement			1
Solicitation			1
Voting Information			1
Corporate Governance Matters			4
Proposal 1 — Election of Certain Directors			9
Compensation Discussion and Analysis			15
Compensation Committee Report			29
Executive Compensation			30
Summary Compensation Table			30
Grants of Plan-Based Awards			32
Outstanding Equity Awards at December 31, 2009			34
Option Exercises and Stock Vested			36
Pension Benefits			36
Nonqualified Deferred Compensation			37
Potential Payments Upon Termination or Change of Control			38
Risk Considerations in Compensation Decisions			42
Director Compensation			43
Security Ownership			47
Proposal 2 — The Approval of the Amendment of the Pentair, Inc. 2008 Omnibus Stock Incentive Plan to Increase the Number of Shares Available for Grant			49
Proposal 3 — The Ratification of Appointment of Deloitte & Touche LLP as our Independent Registered Public Accounting Firm for 2010			63
Audit Committee Disclosure			64
Audit Committee Report			65
Section 16(a) Beneficial Ownership Compliance			66
Shareholder Proposals for the 2011 Annual Meeting of Shareholders			66
Other Business			66
2009 Annual Report on Form 10-K			66
Reduce Duplicate Mailings			66
Appendix A — Pentair, Inc. 2008 Omnibus Stock Incentive Plan, As Amended And Restated Through February 23, 2010			A-1

PROXY STATEMENT

FOR THE

ANNUAL MEETING OF SHAREHOLDERS OF

PENTAIR, INC.

TO BE HELD ON THURSDAY, APRIL 29, 2010

Solicitation

     This Proxy Statement, the accompanying proxy card and our Annual Report to Shareholders are being mailed on or about March 23, 2010. Our Board of Directors (the “Board”) is soliciting your proxy to vote your shares at the Annual Meeting. The Board is soliciting your proxy to give all shareholders of record the opportunity to vote on matters that will be presented at the Annual Meeting. This Proxy Statement provides you with information on these matters to assist you in voting your shares.

What is a proxy?

     A proxy is your legal designation of another person (the “proxy”) to vote on your behalf. By voting your proxy, you are giving the persons named on the proxy card the authority to vote your shares in the manner you indicate on your proxy card. You vote your proxy by submitting the enclosed proxy card, by telephone or over the Internet.

Why did I receive more than one proxy card?

     You will receive multiple proxy cards if you hold your shares in different ways (for example, joint tenancy, trusts, custodial accounts) or in multiple accounts. If your shares are held by a broker (in “street name”), you will receive your proxy card or other voting information from your broker, and you will return your proxy card or cards or otherwise vote your proxy as indicated in the materials you receive with this Proxy Statement. You should vote your proxy for each separate account you have.

Voting Information

Who is qualified to vote?

     You are qualified to receive notice of the Annual Meeting and to vote if you owned shares of our Common Stock at the close of business on our record date of March 1, 2010.

How many shares of Common Stock may vote at the Annual Meeting?

     As of March 1, 2010, there were 98,647,326 shares of Common Stock outstanding and entitled to vote. Each share of Common Stock is entitled to one vote on each matter presented.

What is the difference between a “shareholder of record” and a “street name” holder?

     These terms describe how your shares are held. If your shares are registered directly in your name with Wells Fargo Bank, N.A., our transfer agent, you are a “shareholder of record.” If your shares are held in the name of a brokerage, bank, trust or other nominee on your behalf, you are a “street name” holder.

How do I vote my shares?

     If you are a “shareholder of record,” you have three choices. You can vote your proxy:

	•		by mailing in the enclosed proxy card;
	•		over the telephone; or
	•		via the Internet.

     Please refer to the specific instructions set forth on the enclosed proxy card. For security reasons, our electronic voting system has been designed to authenticate your identity as a shareholder.

     If you hold your shares in “street name,” your broker/banker/trustee/nominee will provide you with materials and instructions for voting your shares.

Can I vote my shares in person at the Annual Meeting?

     If you are a “shareholder of record,” you may vote your shares in person at the Annual Meeting. If you hold your shares in “street name,” you must obtain a proxy from your broker, banker, trustee or nominee, giving you the right to vote the shares at the Annual Meeting.

What are the Board’s recommendations on how I should vote my shares?

     The Board recommends that you vote your shares as follows:

	Proposal 1 —		FOR the election of four nominees for election to our Board with terms expiring at the 2013 Annual Meeting of Shareholders.
	Proposal 2 —		FOR the approval of the amendment of our 2008 Omnibus Stock Incentive Plan to increase the number of shares available for grant under the Plan.
	Proposal 3 —		FOR the ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2010.

What are my choices when voting?

     Proposal 1 — You may cast your vote in favor of or against electing a nominee as a director, or you may elect to abstain from voting for one, two, three or all nominees.

     Proposals 2 and 3 — You may cast your vote in favor of or against each proposal, or you may elect to abstain from voting your shares.

How would my shares be voted if I do not specify how they should be voted?

     If you submit your signed proxy without indicating how you want your shares to be voted, the persons named on the proxy card will vote your shares according to the Board’s recommendations that are listed above.

     As to any other business that may properly come before the Annual Meeting, the persons named on the proxy card will vote in accordance with their best judgment. We do not presently know of any other business.

     If your shares are held in the name of a bank or brokerage firm, the bank or brokerage firm has the discretionary authority to vote your shares in connection with the ratification of our independent registered public accounting firm if you do not timely provide your proxy because this matter is considered “routine” under the New York Stock Exchange (“NYSE”) listing standards. For the election of directors and the proposal to amend our 2008 Omnibus Stock Incentive Plan, the bank or brokerage firm has no discretionary authority to vote your shares.

What if I do not direct the custodian of my shares how to vote my shares?

     If your shares are held by a custodian, such as a bank or brokerage firm, and you do not direct them how to vote, your shares may not be voted at all, or they may be voted only on Proposal 3, approving the Company’s auditors for 2010.

     We urge you to carefully consider all of the proposals and direct your custodian to vote your shares as you wish. Because of a recent change in SEC regulations, your custodian may no longer vote for or against directors without your direction. We are concerned that smaller shareholders may not direct their custodians to vote their shares, which could result in failure to have sufficient votes represented at our annual meeting to constitute a quorum. In the absence of a quorum, the annual meeting of shareholders could not be held as scheduled, and could be delayed.

     Further, we believe that the proposals on the ballot for the election of directors and approval of an amendment to our 2008 Omnibus Stock Incentive Plan are important to the Company and its shareholders, and deserve careful consideration and voting by all shareholders.

How many shares of Common Stock constitute a quorum for the Annual Meeting?

     A majority of the shares of Common Stock outstanding as of March 1, 2010, or 49,323,664 shares, will constitute a quorum at the Annual Meeting.

What vote is required to approve each proposal?

     For election of directors, approval by a majority of all shares entitled to vote is necessary for the election of each director. For approval of other proposals, each proposal requires the affirmative vote of a majority of those shares present in person or represented by proxy and entitled to vote at the Annual Meeting; provided that in the case of Proposal 2, a majority of the outstanding shares are voted on the proposal.

How are abstentions and broker non-votes treated?

     Abstentions and broker non-votes are counted for purposes of determining the presence or absence of a quorum for the transaction of business at the Annual Meeting. Minnesota law and our Articles of Incorporation provide that abstentions are counted in determining the total number of the votes cast on proposals presented to shareholders, but that abstentions are not treated as votes in favor of proposals voted upon at the Annual Meeting. Broker non-votes are not counted for purposes of determining the total number of votes cast on proposals presented to shareholders.

Can I change my vote after I have submitted my proxy?

     You may revoke your proxy by doing one of the following:

	•		by sending a written notice of revocation to our Secretary that is received before the Annual Meeting, stating that you revoke your proxy;
	•		by delivering a later-dated proxy by telephone, on the Internet, or in writing so that it is received before the Annual Meeting in accordance with the instructions included in the proxy card(s); or
	•		by attending the Annual Meeting and voting your shares in person.

Who will count the votes?

     Representatives from Wells Fargo Bank, N.A., our transfer agent, will count the votes and serve as our Inspectors of Election. The Inspectors of Election will be present at the Annual Meeting.

Who pays the cost of this proxy solicitation?

     We pay the costs of soliciting proxies sought by the Board. Upon request, we will reimburse brokers, dealers, banks and trustees, or their nominees, for reasonable expenses incurred by them in forwarding proxy materials to beneficial owners of shares of our Common Stock. Morrow & Co., 470 West Avenue, Stamford, Connecticut, is assisting us in the solicitation of proxies at a cost to us of $8,500, plus expenses.

CORPORATE GOVERNANCE MATTERS

Board Governance

     The Board has adopted and regularly reviews and, if appropriate, revises its Corporate Governance Principles and written charters for its Audit Committee, Compensation Committee, Governance Committee and International Committee in accordance with rules of the Securities and Exchange Commission (“SEC”) and the NYSE. We and our Board continue to be committed to the highest standards of corporate governance and ethics. The Board has adopted Pentair’s Code of Business Conduct and Ethics (“Code of Conduct”) and has designated it as the code of ethics for our Chief Executive Officer and senior financial officers. Copies of all of these documents are available, free of charge, on our website at www.pentair.com/About-Us/Our-Values.aspx.

Board Leadership Structure

Our Board Governance Principles, which can be found at http://www.pentair.com/About-Us/Corporate-Governance/Corporate-Governance-Principles.aspx, describe our policies concerning:

	•		Selection and Composition of the Board
	•		Board Leadership
	•		Board Composition and Performance
	•		Responsibilities of the Board
	•		Board Relationship to Senior Management
	•		Meeting Procedures
	•		Committee Matters
	•		Leadership Development

We do not have a policy requiring the positions of Chairman of the Board and Chief Executive Officer to be held by different persons. Rather, the Board has the discretion to determine whether or not the positions should be combined or split. Since 2002, our Chief Executive Officer has also been the Chairman of the Board. The Board believes that this leadership structure has worked well for several reasons, among them:

	•		We have historically had a super-majority of independent directors; only one or two officers of the Company have served at any one time as directors (out of 10 or 11 members of the Board)
	•		Our independent directors meet in executive session without the Chief Executive Officer present at every regular meeting of the Board
	•		Our annual Board Assessment process addresses issues of Board structure and director performance
	•		We have and have had since 2003 an independent member of the Board as our Lead Director
	•		Our Lead Directors have served as an effective communication channel between the independent Board members and the Chief Executive Officer and among the independent Board members

Our Lead Director is selected by the Independent Directors on our Board. His role is to provide independent leadership to the Board, act as liaison between the non-management directors and the Company, and ensure that the Board operates independently of management. The principle responsibilities assigned to the Lead Director include:

	•		Chairing the Board in the absence of the CEO;
	•		Presiding over all executive sessions of the Board;
	•		In conjunction with the Chairman of the Compensation Committee, giving annually the Board’s performance review of the Chief Executive Officer;
	•		In conjunction with the Chairman, approving the agenda for Board meetings, including scheduling to assure sufficient time for discussion of all agenda items;
	•		In conjunction with the Chairman and Committee Chairs, ensuring an appropriate flow of information to the Directors;
	•		Communicating to management as appropriate the results of private discussions among independent directors;
	•		Holding one-on-one discussions with individual directors where requested by directors or the Board; and

•

Carrying out other duties as requested by the Board.

Board’s Role in Risk Oversight

At the direction of our Board of Directors, we have instituted an enterprise-wide risk management system to assess, monitor and mitigate risks that arise in the course of our business. The Board has determined that the Board of Directors as a whole, and not a separate committee, will oversee the Company’s risk management process. Each of our Board Committees has historically focused on specific risks within their areas of responsibility, but the Board believes that the overall enterprise risk management process is more properly overseen by all of the members of the Board. The Company’s general counsel and head of internal audit are the primary personnel responsible to the Board in the planning, assessment and reporting of the Company’s risk profile. At this stage in the implementation of our risk management system, the Board reviews the status of the implementation of the process and findings at every regularly scheduled Board meeting.

Shareholder and Other Stakeholder Communication with the Board

     If you are a shareholder or other stakeholder and wish to communicate with the Board, non-management directors as a group or any individual director, including the Lead Director, you may send a letter addressed to the relevant party, c/o Corporate Secretary, Pentair, Inc., 5500 Wayzata Boulevard, Suite 800, Minneapolis, MN 55416. The Board has instructed the Secretary to forward such communications directly to the addressee(s).

Committees of the Board

     The Board has four standing committees: the Audit Committee, the Compensation Committee, the Governance Committee and the International Committee. The International Committee meets once or twice a year. The other committees generally hold meetings when the Board meets and additionally as needed. Management representatives attend each committee meeting. Independent directors generally also meet in executive session without management present at each meeting.

Audit Committee

Role:		The Audit Committee is responsible, among other things, for assisting the Board with oversight of our accounting and financial reporting processes and audits of our financial statements. These responsibilities include the integrity of the financial statements, compliance with legal and regulatory requirements, the independence and qualifications of our external auditor and the performance of our internal audit function and of the external auditor. The Audit Committee is directly responsible for the appointment, compensation, terms of engagement (including retention and termination) and oversight of the work of the external auditor. The Audit Committee holds meetings periodically with our independent and internal auditors, the Board and management to review and monitor the adequacy and effectiveness of reporting, internal controls, risk assessment and compliance with our policies.
Meetings:		The Audit Committee held nine meetings in 2009.
Members:		The members of the Audit Committee are Ronald L. Merriman (Chair), Leslie Abi-Karam, Jerry W. Burris, Charles A. Haggerty and David H. Y. Ho. All members have been determined to be independent under SEC and NYSE rules. Mr. Merriman is a member of the audit committees of Aircastle Limited, Realty Income Corporation and Haemonetics Corporation, each of which is a publicly-traded company. The Board has determined that Mr. Merriman’s service on the audit committees of three other public companies does not impair his ability to effectively serve as Chair of our Audit Committee.
Report:		You can find the Audit Committee Report on page 65 of this Proxy Statement.
Charter:		You can find the Audit Committee Charter at: www.pentair.com/Assets/Audit-Committee-Charter.aspx.

Financial Experts:		The Board has unanimously determined that all members of the Audit Committee are financially literate under NYSE rules and at least one member has financial management expertise. In addition, the Board has determined that all members of the Audit Committee qualify as “audit committee financial experts” under SEC standards.

Compensation Committee

Role:		The Compensation Committee sets and administers the policies that govern executive compensation. This includes establishing and reviewing executive base salaries, administering the Management Incentive Plan and the Executive Officer Performance Plan and administering equity-based compensation under the Omnibus Stock Incentive Plan. The Compensation Committee also sets the Chief Executive Officer’s compensation based on the Board’s annual evaluation of the Chief Executive Officer’s performance. The Committee has engaged Hewitt Associates, a human resources consulting firm, to aid the Committee in its annual review of our executive and director compensation programs for continuing appropriateness and reasonableness and to make recommendations regarding executive officer and director compensation levels and structures. In reviewing our compensation programs, the Compensation Committee also considers other sources to evaluate external market, industry and peer company practices. Hewitt provided no services to us in 2009 other than those services commissioned by the Compensation Committee and the Governance Committee with respect to executive and director compensation. A more complete description of these practices can be found on pages 15 — 17 of this Proxy Statement under the headings “Compensation Committee Practices,” “Services of Compensation Consultant,” “Role of Executive Officers in Compensation Decisions,” “Setting Executive Compensation” and “Comparative Framework” in the Compensation Discussion and Analysis section of this Proxy Statement.
Meetings:		The Compensation Committee held five meetings in 2009.
Members:		The members of the Compensation Committee are David A. Jones (Chair), Glynis A. Bryan, T. Michael Glenn and William T. Monahan. All members have been determined to be independent under NYSE rules.
Report:		You can find the Compensation Committee Report on page 29 of this Proxy Statement.
Charter:		You can find the Compensation Committee Charter at: www.pentair.com/Assets/Compensation-Committee-Charter.aspx.

Governance Committee

Role:		The Governance Committee is responsible, among other things, for identifying individuals qualified to become directors and recommending nominees to the Board for election at annual meetings of shareholders. In addition, the Governance Committee monitors developments in director compensation and, as appropriate, recommends changes in director compensation to the Board. The Governance Committee is also responsible for developing and recommending to the Board our corporate governance principles. Finally, the Governance Committee oversees public policy matters and compliance with our Code of Conduct.
Meetings:		The Governance Committee held five meetings in 2009.
Members:		The members of the Governance Committee are Glynis A. Bryan (Chair), T. Michael Glenn, David A. Jones and William T. Monahan. All members have been determined to be independent under NYSE rules.
Charter:		You can find the Governance Committee Charter at: www.pentair.com/Assets/Governance-Committee-Charter.aspx.

Role:		The International Committee reviews the international aspects of our business operations and assists management in formulating growth, development and organizational strategies for our global business units.
Meetings:		The International Committee held two meetings in 2009.
Members:		The members of the International Committee are David A. Jones (Chair), David H. Y. Ho, Ronald L. Merriman, William T. Monahan and Randall J. Hogan (ex officio).
Charter:		You can find the International Committee Charter at: www.pentair.com/Assets/International-Committee-Charter.aspx.

Compensation Committee Interlocks and Insider Participation

     During 2009, we did not employ any member of the Compensation Committee as an officer or employee and there were no interlock relationships.

Independent Directors

     The Board determines the independence of each director and nominee for election as a director. The Board makes these determinations in accordance with the NYSE rules for independence of directors and our categorical standards of independence included in the Corporate Governance Principles, which you can find at http://www.pentair.com/About-Us/Corporate-Governance/Corporate-Governance-Principles.aspx. Based on these standards, at its meeting held on February 23, 2010, the Board affirmatively determined that each of the following non-employee directors and non-employee director nominees is independent and has no material relationship with us, except as a director or shareholder:

	(1)		Leslie Abi-Karam
	(2)		Glynis A. Bryan
	(3)		Jerry W. Burris
	(4)		T. Michael Glenn
	(5)		Charles A. Haggerty
	(6)		David H. Y. Ho
	(7)		David A. Jones
	(8)		Ronald L. Merriman
	(9)		William T. Monahan

     In addition, based on the NYSE standards and our categorical standards of independence included in the Corporate Governance Principles, the Board affirmatively determined that Randall J. Hogan is not independent because he is our Chief Executive Officer.

     In determining the independence of directors, our Governance Committee considers circumstances where one of our directors also serves as a director or executive officer of a company that is our customer or supplier. The Governance Committee has reviewed each of these relationships, which are set forth below. In each case, the relationship involves sales to or purchases from the organization indicated which (i) amount to less than the greater of $1 million or 2% of that organization’s consolidated gross revenues during each of 2009, 2008 and 2007; and (ii) during all relevant years were not of an amount or nature that impeded the director’s exercise of independent judgment.

Director		Relationships Considered
Leslie Abi-Karam		Executive Vice President and President, Mailing Solutions Management, Pitney Bowes Inc.
Glynis A. Bryan		Chief Financial Officer, Insight Enterprises, Inc.

Director		Relationships Considered
Jerry W. Burris		President, Precision Components, Barnes Group Inc.
T. Michael Glenn		Executive Vice President — Market Development and Corporate Communications, FedEx Corporation
Charles A. Haggerty		Director, Beckman Coulter, Inc.
Charles A. Haggerty		Director, Deluxe Corporation
Charles A. Haggerty		Director, Imation Corp.
David H. Y. Ho		Former Chairman of the Greater China Region, Nokia Siemens Network
David H. Y. Ho		Former President, Nokia China Investment Limited, a subsidiary of Nokia Corporation

Policies and Procedures Regarding Related Person Transactions

     Our Board has adopted written policies and procedures regarding related person transactions. For purposes of these policies and procedures:

	•		a “related person” means any of our directors, executive officers or five-percent shareholders or any of their immediate family members; and
	•		a “related person transaction” generally is a transaction (including any indebtedness or a guarantee of indebtedness) in which we were or are a participant and the amount involved exceeds $50,000, and in which a related person had or will have a direct or indirect material interest.

     Potential related person transactions must be brought to the attention of the Governance Committee directly or to the General Counsel for transmission to the Governance Committee. Disclosure to the Governance Committee should occur before, if possible, or as soon as practicable after the related person transaction is effected, but in any event as soon as practicable after the executive officer or director becomes aware of the related person transaction. The Governance Committee’s decision whether or not to approve or ratify a related person transaction is to be made in light of a number of factors, including the following:

	•		whether the terms of the related person transaction are fair to us and on terms at least as favorable as would apply if the other party was not or did not have an affiliation with any of our directors, executive officers or five-percent shareholders;
	•		whether there are demonstrable business reasons for us to enter into the related person transaction;
	•		whether the related person transaction could impair the independence of a director under the Corporate Governance Principles’ standards for director independence; and
	•		whether the related person transaction would present an improper conflict of interest for any of our directors or executive officers, taking into account the size of the transaction, the overall financial position of the director or executive officer, the direct or indirect nature of the interest of the director or executive officer in the transaction, the ongoing nature of any proposed relationship, and any other factors the Committee deems relevant.

     We had no related person transactions during 2009. To our knowledge, no related person transactions are currently proposed.

Election of Certain Directors

Information About Directors

Board Composition

          Our Articles of Incorporation currently provide for a Board of eleven members. The Board is divided into three classes with directors serving three-year terms. The beginning date for each term is staggered so that, in any particular year, the term of only one class expires. Vacancies may be filled through appointment by the Board or through election by shareholders at a special meeting of shareholders called for that purpose. Any director appointed by the Board is required to stand for election at the next annual meeting of shareholders or next special meeting of shareholders called for that purpose. Incumbent directors T. Michael Glenn, David H.Y. Ho, Glynis A. Bryan and William T. Monahan are standing for election at the Annual Meeting. There is one fewer nominee for election to the Board than there are available positions on the Board. Regardless of this vacancy, you may vote your shares only for the number of nominees for director named in this Proxy Statement.

Directors’ Attendance

          The Board held six meetings in 2009. In each of the regularly scheduled meetings, the independent directors also met in executive session, without the Chief Executive Officer or other management present. All directors attended at least 75% of the aggregate of all meetings of the Board and all meetings of the Committees on which they served during the fiscal year ended December 31, 2009. We expect our directors to attend our annual meetings of shareholders. In April 2009, all of the directors then in office attended the 2009 annual meeting of shareholders. William T. Monahan has served as the Board’s Lead Director since January 1, 2008 and acts as the presiding director for all executive sessions of the independent directors.

Director Qualifications

          The Governance Committee searches for qualified candidates to be a director, reviews the qualifications of each candidate and recommends to the Board the names of qualified candidates to be nominated for election or re-election as directors. The Board reviews the candidates recommended by the Governance Committee and nominates candidates for election or re-election by the shareholders. The Governance Committee recognizes that the contribution of the Board will depend both on the character and capacities of the directors taken individually and on their collective strengths. With this in mind, the Governance Committee evaluates candidates in light of a number of criteria. Directors are chosen with a view to bringing to the Board a variety of experience and backgrounds and establishing a core of business advisers with financial and management expertise. The Governance Committee also considers candidates who have substantial experience outside the business community, such as in the public, academic or scientific communities.

          When they consider possible candidates for appointment or election as directors, the Governance Committee and the Board are also guided by the following principles, found in our Board Governance Principles:

	•		the Corporate Governance Principles and the rules adopted by the SEC and the NYSE require that at least a majority of the Board consist of independent directors;
	•		each director should be chosen without regard to sex, sexual orientation, race, religion or national origin;
	•		each director should possess the highest character and integrity and have an inquiring mind, vision and the ability to work well with others;
	•		each director should be free of any conflict of interest which would violate any applicable law or regulation or interfere with the proper performance of the responsibilities of a director;

	•		each director should possess substantial and significant experience which would be of particular importance to us in the performance of the duties of a director and would increase the diversity of experience, expertise and training of the Board taken as a whole;
	•		each director should have sufficient time available to devote to our affairs in order to carry out the responsibilities of a director; and
	•		each director should be committed to enhancing long-term shareholder value and be willing and able to represent the balanced, best interests of the shareholders as a whole rather than the interests of a special interest group or constituency.

Our Board’s policies on director qualifications emphasize the Company’s commitment to diversity at the Board level — diversity not only of sex, sexual orientation, race, religion or national origin but also diversity of experience, expertise and training. The Governance Committee in the first instance is charged with observance of these director selection guidelines, and strives in reviewing potential candidates to assess the fit of his or her qualifications with the needs of the Board and the Company at that time, given the then current mix of directors’ attributes. Board composition, director effectiveness and Board processes, including director recruitment and selection, are all subject areas of our annual Board Assessment.

Shareholder Nominees

          Shareholders submitted to the Governance Committee no candidates for nomination for election as a director at the 2010 Annual Meeting. According to our By-Laws, a shareholder must give advance notice and furnish certain information in order to submit a nomination for election as a director. Any shareholder who wishes to present a candidate for consideration by the Governance Committee for election at the 2011 meeting should send a letter identifying the name of the candidate and summary of the candidate’s qualifications, along with the other supporting documentation described in Article 1, Section 10 of our By-Laws, to the Governance Committee. This letter should be addressed c/o Corporate Secretary, Pentair, Inc., 5500 Wayzata Boulevard, Suite 800, Minneapolis, MN 55416 no earlier than January 11, 2011 and no later than February 6, 2011 for consideration at the 2011 Annual Meeting. You may find a copy of our By-Laws on file with the SEC by searching the EDGAR archives at www.sec.gov/edgar/searchedgar/webusers.htm. You may also obtain a copy from us free of charge by submitting a written request to the Corporate Secretary, Pentair, Inc., 5500 Wayzata Boulevard, Suite 800, Minneapolis, MN 55416.

Election of Directors

          The Board, upon recommendation of the Governance Committee, has nominated incumbent directors T. Michael Glenn, David H.Y. Ho, Glynis A. Bryan and William T. Monahan for three-year terms that expire at the 2013 Annual Meeting of Shareholders. Six directors have terms of office that do not expire at this time and we expect that they will continue to serve their full terms.

          Biographies of the director nominees and continuing directors follow. These biographies include their ages (as of March 17, 2010); an account of their specific business experience; the names of publicly held and certain other corporations of which they also are, or have been within the past five years, directors; and a discussion of their specific experience, qualifications, attributes or skills that led to the conclusion that they should serve as directors.

Directors Standing For Election

     For a Three-Year Term Expiring at the 2013 Annual Meeting of Shareholders

T. Michael Glenn, director since 2007, age 54

          Since January 1998, Mr. Glenn has been the Executive Vice President — Market Development and Corporate Communications of FedEx Corporation, a global provider of supply chain, transportation, business and related information services. From June 1994 to January 1998, Mr. Glenn was Senior Vice President — Marketing and Corporate Communications of FedEx Express. Mr. Glenn is also a director of Renasant Corporation, and was formerly a director of Deluxe Corporation from July 2004 to April 2006.

          Mr. Glenn brings extensive strategic, marketing and communications experience to our Board from his service as one of the top leaders at FedEx Corporation. He has been an active participant in the development of the Company’s strategic plans over the past three years, and a strong proponent for strengthening our branding and marketing initiatives.

David H. Y. Ho, director since 2007, age 50

          Since November 2008, Mr. Ho has been the Chairman of Kiina Group, a China-based group of private companies engaged in investment in start-up Internet, communications and technology companies; consulting services for multinational companies in the Greater China market; and investment in real estate properties. From April 2007 to November 2008, Mr. Ho served as the Chairman of the Greater China Region for Nokia Siemens Network, a joint venture between Finland-based Nokia Corporation, a multinational telecommunications company, and Germany-based Siemens AG. Between April 2004 and March 2007, Mr. Ho served as the President of Nokia China Investment Limited, the Chinese operating subsidiary of Finland-based Nokia Corporation, a multinational telecommunications company. Between January 2002 and November 2008, Mr. Ho also served as Nokia China Investment Limited’s Senior Vice President, Networks — Greater China. Between 2000 and August 2001, Mr. Ho was the Senior Vice President and Chief Operating Officer of Nortel Networks China Limited, the Chinese operating subsidiary of Canada-based Nortel Networks Corporation, a multinational telecommunications company. Between 1998 and 1999, Mr. Ho was the Vice President and General Manager of Nortel Networks China Limited’s Greater China Wireless Solutions division. Prior to joining Nortel Networks China Limited, Mr. Ho spent 15 years working in the Chinese operating subsidiaries of multinational telecommunications companies in roles of increasing responsibility. Mr. Ho is also a director of 3Com Corporation, Owens-Illinois, Inc., Sinosteel Corp. and Dongfang Electrical Corporation.

          Mr. Ho’s extensive experience in global markets, especially in China, has contributed greatly as we have expanded our presence throughout the world, particularly in the Asia-Pacific region. In addition, he brings to our Board significant management expertise in operations, mergers, acquisitions and joint ventures in the area.

Glynis A. Bryan, director since 2003, age 51

          Ms. Bryan serves as the Chair of the Governance Committee. Since December 2007, Ms. Bryan has been the Chief Financial Officer of Insight Enterprises, Inc., a leading provider of information technology products and solutions to clients in North America, Europe, the Middle East and the Asia-Pacific region. Between April 2005 and May 2007, Ms. Bryan was the Executive Vice President and Chief Financial Officer of Swift Transportation Co., a holding company which operates the largest fleet of truckload carrier equipment in the United States. Between 2001 and March 2005, Ms. Bryan was the Chief Financial Officer of APL Logistics, the supply-chain management arm of Singapore-based NOL Group, a logistics and global transportation business. Prior to joining APL, Ms. Bryan spent 16 years with Ryder System, Inc., a truck leasing company, where she held a series of progressively responsible positions in finance. In her last assignment, Ms. Bryan was Senior Vice President of Ryder Capital Services, where she led the development of the firm’s capital services business. In 1999 and 2000, Ms. Bryan served as Senior Vice President and Chief Financial Officer of Ryder Transportation Services.

          Ms. Bryan has extensive global financial and accounting experience in a variety of business operations, especially in logistics services. Ms. Bryan originally served on the Audit Committee of the Board for five years, and was selected in 2009 by the Board to serve as the Chair of the Governance Committee. Her familiarity with all aspects of Board responsibilities at Pentair will be critical in the future as governance and risk management processes continue to develop.

William T. Monahan, director since 2001, age 62

          Mr. Monahan serves as the Lead Director. From August through December 2006, Mr. Monahan served as a director and the Interim Chief Executive Officer of Novelis, Inc., a global leader in aluminum rolled products and aluminum can recycling. From November 1995 to May 2004, Mr. Monahan was Chairman of the Board of Directors and Chief Executive Officer of Imation Corp., a manufacturer of magnetic and optical data storage media. Mr. Monahan is also a director of Hutchinson Technology, Inc., The Mosaic Company and Solutia Inc. and was a director of Novelis, Inc. from January 2005 to May 2007.

          Mr. Monahan brings to our Board a wealth of global operational and management experience, as well as a deep understanding of our businesses gained as a member of our Board for nine years. Mr. Monahan has extensive

service as a board member and CEO at companies in a number of different industries; his broad international perspective on business operations has been instrumental as the Company becomes more global.

Directors Not Standing For Election

      With a Three-Year Term Expiring at the 2011 Annual Meeting of Shareholders

Leslie Abi-Karam, director since 2008, age 51

          Since March 2008, Ms. Abi-Karam has been the Executive Vice President and President, Mailing Solutions Management of Pitney Bowes Inc., a global mailstream technology company. Between December 2002 and March 2008, Ms. Abi-Karam was the Executive Vice President and President, Document Messaging Technologies (DMT) of Pitney Bowes Inc. She is also responsible for all engineering, global supply chain and direct procurement operations, supplying products and sourcing for all commodity/spend management within Pitney Bowes worldwide. Between October 2000 and December 2002, Ms. Abi-Karam was President, Global Mail Creation and Mail Finishing, of Pitney Bowes Inc. She has been with Pitney Bowes since 1984 and has held various roles of increasing responsibility.

          Ms. Abi-Karam brings to our Board significant experience in the management of global technology businesses. As a current operating leader, Ms. Abi-Karam faces many of the same challenges as the Company and provides perspective on alternative solutions to common problems.

Jerry W. Burris, director since 2007, age 46

          Since October 2008, Mr. Burris has been the President, Precision Components of Barnes Group Inc. From July 2006 until October 2008, Mr. Burris was the President of Barnes Industrial, a global precision components business within Barnes Group. Prior to joining Barnes Group, Mr. Burris worked at General Electric Company, a multinational technology and services conglomerate, where he served as president and chief executive officer of Advanced Materials Quartz and Ceramics in 2006. From 2003 to 2006, Mr. Burris was the general manager of global services for GE Healthcare. From 2001 to 2003, he led the integration of global supply chain sourcing for the Honeywell integration and served as the general manager of global sourcing for GE Industrial Systems. Mr. Burris first joined GE in 1986 in the GE Corporate Technical Sales and Marketing Program.

          Mr. Burris brings to our Board significant experience in management of global manufacturing operations and related processes, such as supply chain management, quality control and product development. Mr. Burris provides the Board with insight into operating best practices and current developments in a variety of management contexts.

Ronald L. Merriman, director since 2004, age 65

          Mr. Merriman serves as the Chair of the Audit Committee. He is a Managing Director of Merriman Partners, a management advisory firm. He served as Managing Director of O’Melveny & Myers LLP, a global law firm, from 2000 to 2003; Executive Vice President of Carlson Wagonlit Travel, a global travel management firm, from 1999 to 2000 and Executive Vice President of Ambassador International, Inc., a publicly-traded travel services business, from 1997 to 1999. From 1967 to 1997, Mr. Merriman was employed by KPMG, a global accounting and consulting firm, where he ultimately served as a Vice Chair and member of the Executive Management Committee. He is also a director of Aircastle Limited, Realty Income Corporation and Haemonetics Corporation. Mr. Merriman also served as a director of Cardio Dynamics International from July 2003 to July 2005 and as a director of Corautus Genetics Inc. from April 2004 to May 2005.

          Mr. Merriman’s extensive accounting and financial background has strengthened our Audit Committee and its processes over the past six years. In addition, his global experience and contributions to our International Committee have assisted us in our expansion into overseas markets.

          With a Three-Year Term Expiring at the 2012 Annual Meeting of Shareholders

Charles A. Haggerty, director since 1994, age 68

          Mr. Haggerty is currently Chief Executive Officer of LeConte Associates, LLC, a consulting and investment firm. Mr. Haggerty joined Western Digital Corporation, a maker of hard disc drives, in June 1992,

where he served as Chief Operating Officer until July 1993, as Chief Executive Officer and Chairman of the Board from July 1993 until he retired as Chief Executive Officer in January 2000 and as Chairman in June 2000. From 1964 to 1992, Mr. Haggerty served in various positions at International Business Machines Corporation. Mr. Haggerty is also a director of Imation Corp., Beckman Coulter, Inc., Deluxe Corporation and LSI Corp.

          Mr. Haggerty’s long record of service with Pentair as director and Lead Director, his familiarity with the Company and our various businesses, his executive management experience, extensive service as a director at other public companies, as well as his interest and expertise in corporate governance issues give Mr. Haggerty a deep understanding of the role of the Board of Directors that is instrumental in maintaining the functionality of the Board. Mr. Haggerty has served as a member of each of our Board committees, which has given him a firm understanding of the impact on us of a wide range of business situations.

Randall J. Hogan, director since 1999, age 54

          Since January 1, 2001, Mr. Hogan has been our Chief Executive Officer. Mr. Hogan became Chairman of the Board on May 1, 2002. From December 1999 through December 2000, Mr. Hogan was our President and Chief Operating Officer. From March 1998 to December 1999, he was Executive Vice President and President of our Electrical and Electronic Enclosures Group. From February 1995 to August 1997, he was President of the Carrier Transicold Division of United Technologies Corporation. From 1994 until 1995, he was Vice President and General Manager of Pratt & Whitney Industrial Turbines. From 1988 until 1994, he held various executive positions at General Electric. From 1981 until 1987, he was a consultant at McKinsey & Company. Mr. Hogan is also a director of Covidien plc. Mr. Hogan also served as a director of Unisys Corporation from March 2004 to September 2006.

          Mr. Hogan’s experience in operational management both with us and predecessor employers, his deep knowledge of business in general and our businesses, strengths and opportunities in particular, and his experience as a director in two other complex global public companies allow him to make significant contributions to the Board.

David A. Jones, director since 2003, age 60

          Mr. Jones serves as the Chair of the International and Compensation Committees. Since February 2008, Mr. Jones has been Senior Advisor to Oak Hill Capital Partners, a private equity firm. Between 1996 and May 2007, Mr. Jones was Chairman and Chief Executive Officer of Spectrum Brands, Inc. (formerly Rayovac Corporation), a global consumer products company with major businesses in batteries, lighting, shaving/grooming, personal care, lawn and garden, household insecticide and pet supply product categories. From 1996 to April 1998, he also served Rayovac as President. After Mr. Jones was no longer an executive officer of Spectrum Brands, it filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code in March 2009 and exited from bankruptcy proceedings in August 2009. From 1995 to 1996, Mr. Jones was Chief Operating Officer, Chief Executive Officer, and Chairman of the Board of Directors of Thermoscan, Inc. From 1989 to 1994, he served as President and Chief Executive Officer of The Regina Company. Mr. Jones also served as a director of Simmons Bedding Company from January 2000 to January 2010, as a director of Spectrum Brands from September 1996 to August 2007, and as a director of Tyson Foods, Inc. from October 1999 to July 2005.

          Mr. Jones’ extensive management experience with both public and private companies and private equity funds, coupled with his global operational, financial and mergers and acquisitions expertise, have given the Board invaluable insight into a wide range of business situations. Mr. Jones has served on each of our Board Committees, which has given him an understanding of the impact on us of a wide range of business situations.

          Under our By-Laws, election of directors requires the affirmative vote of a majority of all shares entitled to vote. A nominee who does not receive a majority of the votes will not be elected to our Board of Directors. The Board has the power to appoint directors to vacant positions, as would arise with respect to a nominee who did not obtain the requisite majority vote. Any such appointee must stand for election at the next annual shareholders’ meeting or at the next special shareholders’ meeting called for that purpose.

          If elected, each of the four director nominees standing for election at the Annual Meeting will serve on the Board until the Annual Meeting in 2013. If any of the four nominees should become unable to accept election, the persons named on the proxy card as proxies may vote for other person(s) selected by the Board or the named

proxies. Management has no reason to believe that any of the four nominees for election named above will be unable to serve.

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH DIRECTOR NOMINEE.

COMPENSATION DISCUSSION AND ANALYSIS

Overview of Compensation Program

          The Compensation Committee (the “Committee”) of our Board sets and administers the policies that govern our executive compensation, including:

	•		establishing and reviewing executive base salaries;
	•		overseeing our annual incentive compensation plans;
	•		overseeing our long-term equity-based compensation plan;
	•		approving all awards under those plans; and
	•		annually approving and recommending to the Board all compensation decisions for executive officers, including those for the Chief Executive Officer and the other officers named in the Summary Compensation Table below (all, collectively, the “Named Executive Officers”).

          The Committee seeks to assure that compensation paid to the Named Executive Officers is fair, reasonable and competitive, and is linked to increasing long-term shareholder value. Only independent directors serve on the Committee.

Compensation Philosophy and Objectives

          The Committee believes that the most effective executive compensation program aligns executive initiatives with shareholders’ economic interests. The Committee seeks to accomplish this by rewarding the achievement of specific annual, longer-term and strategic goals that create lasting shareholder value. The Committee evaluates both executive performance and executive compensation to attract and retain superior employees in key positions at compensation levels competitive in the marketplace. To achieve the objectives stated below, the Committee provides executive compensation packages containing both cash and equity-based compensation components that reward performance as measured against established goals. The Committee’s specific objectives include:

	•		to motivate and reward executives for achieving financial and strategic objectives;
	•		to provide rewards commensurate with individual and company performance;
	•		to encourage innovation and growth;
	•		to attract and retain top-quality executives and key employees; and
	•		to align our employee and shareholder interests by encouraging employee stock ownership.

          To balance these objectives, our executive compensation program uses the following elements:

	•		base salary, to provide fixed compensation competitive in the marketplace;
	•		annual incentive compensation, to reward short-term performance against specific financial targets and individual goals;
	•		long-term incentive compensation, to link management incentives to long-term value creation and shareholder return; and
	•		retirement, perquisites and other benefits, to attract and retain management and other employees over the longer term.

     We discuss each of these components below under the topics “2009 Compensation Program Elements” and “Changes in Compensation Program Mix for 2010” on pages 17 and 22 of this Proxy Statement.

Compensation Committee Practices

          The Committee meets regularly to review, discuss and approve executive compensation and employee benefit plan matters. To ensure it is able to address all of its responsibilities, the Committee establishes an annual agenda at the beginning of each year. In 2009, the Committee held five regular meetings. The Committee has

scheduled five regular meetings for 2010. In addition to the regularly scheduled meetings, the Committee holds additional meetings when necessary.

          Committee members generally receive written materials several days prior to each regularly scheduled meeting. At the close of each regularly scheduled Committee meeting, the Committee conducts an executive session without management present. When appropriate, the Committee also meets in executive session at the close of special meetings. At the Committee’s request, the Committee’s external compensation consultant reviews committee meeting materials and attends meetings.

          In making changes to our compensation programs, the Committee considers our compensation philosophy and objectives, as well as external market, industry and peer company practices. The Committee reviews each element of the executive compensation program annually for continuing appropriateness and reasonableness.

          In December 2008 and February 2009, the Committee reviewed and approved executive salaries, equity plan incentive grants, and performance measures and related targets for our annual incentive program for 2009. When reviewing proposed awards, the Committee considered our corporate performance for the year and the prior three-year period against the peer group of companies identified as the “Comparator Group” in the section below entitled “Comparative Framework.” The Committee also considered our corporate performance compared to our strategic objectives. The Committee reviewed and approved equity grants for newly hired and promoted employees as required throughout the year. Committee actions relating to executive salary, incentive awards and long-term compensation, as well as changes to our compensation programs, were submitted to the full Board for ratification and approval.

Services of Compensation Consultant

     In 2009, the Committee retained Hewitt Associates, an external compensation consultant (the “Compensation Consultant”), to advise the Committee on executive compensation issues. The Compensation Consultant provides no services to our company other than those commissioned for the Committee or, as noted below, by the Governance Committee of our Board of Directors.

     The Committee provides the Compensation Consultant with preliminary instructions regarding the goals of our compensation program and the parameters of the competitive review of our executive compensation programs to be conducted by the Compensation Consultant. The Compensation Consultant provides the Committee with comparative market data on position-specific compensation structures, policies and programs based on analyses of relevant survey data and of the practices of the Comparator Group defined below under the heading “Comparative Framework.” The Compensation Consultant also provides guidance on industry best practices and advises the Committee in determining appropriate ranges for base salaries, annual incentives and equity compensation for each senior executive position.

     The Compensation Consultant also provided its services to our Governance Committee in 2009 in connection with its review of the form and amount of compensation paid to Board members. A discussion of the changes to Board compensation for 2010 is set forth at page 43.

Role of Executive Officers in Compensation Decisions

          At the request of the Committee, the Chief Executive Officer and the Senior Vice President, Human Resources, generally attend meetings of the Committee but are not present in executive sessions, and do not participate in deliberations of their own compensation. Our human resources group assists the Committee as requested on specific topics regarding compensation, as well as on specific recommendations for compensation for management throughout the Company.

          The Chief Executive Officer annually reviews with the Committee the performance of each executive officer (other than himself) and presents compensation recommendations based on these reviews to the Committee. The Committee reviews these recommendations with its external compensation consultant and exercises its discretion in adopting, rejecting or changing the compensation proposals. The Committee then recommends the final compensation proposals for all Named Executive Officers, including the Chief Executive Officer, to the full Board for its approval.

          The Committee employs a formal rating process to evaluate the Chief Executive Officer’s performance. As part of this process, the Committee reviews financial and other relevant data related to the performance of the Chief Executive Officer at each meeting of the Board throughout the year. At the end of the year, each independent director provides an evaluation and rating of the Chief Executive Officer’s performance in various categories. The Committee Chair submits a consolidated rating report and the Committee’s recommendations regarding the Chief Executive Officer’s compensation to the independent directors for review and ratification. The Lead Director chairs a discussion with independent Board members in executive session without the Chief Executive Officer present. From that discussion, the Committee finalizes the Chief Executive Officer’s performance rating. The Committee Chair and the Lead Director review the final rating results and commentary with the Chief Executive Officer. The Committee takes the performance rating and financial data into account in determining the Chief Executive Officer’s compensation and the Board’s adoption of goals and objectives for the Chief Executive Officer for the following year.

Setting Executive Compensation

          The Committee recognizes the importance of maintaining sound principles for developing and administering compensation and benefits programs. The Committee seeks to carry out its responsibilities by:

	•		holding executive sessions (without management present) at every regular Committee meeting;
	•		requiring clear communication of compensation policy and actions to employees and the shareholders;
	•		annually reviewing total annual compensation for all executive officers; and
	•		establishing appropriate guidelines for executive change-in-control agreements.

Comparative Framework

          In making its recommendations to the Board concerning executive officer compensation, the Committee annually reviews and evaluates our corporate performance and our executive officers’ compensation and equity ownership. The Committee also obtains and reviews comparative data from the Compensation Consultant and a number of third-party sources, including proxy statements, publicly available information and surveys by consulting firms.

          The Committee uses external competitive benchmarks that it believes support the guiding principles outlined above for each element of compensation. For 2009, the market for assessing compensation was defined as companies with revenue comparable to ours (revenues of approximately $1 billion — $6 billion), publicly traded, headquartered in the U.S., and engaged in one or more manufacturing sectors (the “Comparator Group”). The Committee identified these companies as our Comparator Group based upon the analysis and recommendations of the Compensation Consultant. The Comparator Group consisted of business competitors, similarly structured broadly diversified organizations, and competitors for executive talent: Amphenol Corporation, Cooper Industries LTD, Crane Company, Danaher Corporation, Donaldson Corporation, Inc., Dover Corporation, Eaton Corporation, Flowserve Corporation, Hubbell Inc., ITT Corporation, Pall Corporation, Parker Hannifin Corporation, Rockwell Automation, Inc., A.O. Smith Corporation, SPX Corporation, Thomas & Betts Corporation.

2009 Compensation Program Elements

          For the fiscal year ended December 31, 2009, the principal components of compensation for Named Executive Officers were:

	•		Base salary;
	•		Annual incentive compensation;
	•		Long-term incentive compensation;
	•		Retirement and other benefits; and
	•		Perquisites and other personal benefits.

The Committee reviews total compensation for its executives, and the relative levels of each of these forms of compensation, against the Committee’s goals to attract, retain and incentivize talented executives and to align the interests of these managers with those of our long-term shareholders.

Base Salaries

          We provide Named Executive Officers and other employees with a fixed salary. Focusing on the market value of each job, the Committee’s goal is to target approximately the 50^th percentile (the “Midpoint”) of the Comparator Group for executives’ base salary ranges based on available market data. Market data include published survey data and proxy statement data for our Comparator Group. The Committee establishes each Named Executive Officer’s salary within a range of 20% of the Midpoint. Differences in base salaries among the Named Executive Officers and the extent to which a Named Executive Officer’s base salary is set at a level other than the Midpoint are decided by the Committee based on various factors, including competitive conditions for the Named Executive Officer’s position within the Comparator Group and in the broader employment market, as well as the Named Executive Officer’s length of employment, level of responsibility, experience and individual performance.

          Due to the uncertain market and economic conditions in late 2008 and their impact on the Company’s future performance, the Committee determined in December 2008 to freeze base salaries for most upper management personnel, including all Named Executive Officers at 2008 levels.

          In addition, the Company’s Chief Executive Officer voluntarily agreed to forego payment of 10% of his base salary in May 2009 for the balance of the year. This reduction is reflected in the Summary Compensation Table on page 30.

Annual Incentive Compensation Plan

          To achieve the objective of providing competitive compensation to attract and retain top talent while linking pay to annual performance, we pay a portion of our executives’ cash compensation as incentive compensation tied to annual business performance as measured against annual goals established by the Committee. We pay cash incentive compensation under one of two annual incentive plans, the Executive Officer Performance Plan (“EOPP”) and the Management Incentive Plan (“MIP”). The Committee has the sole discretion to determine in which plan eligible employees participate. Whereas the terms of the MIP permit the Committee to increase or decrease executives’ formula-derived incentive compensation, the Committee has no discretion to increase formula-derived incentive compensation under the EOPP. For 2009, the only participants in the EOPP were the executive officers.

          For each EOPP participant, the Committee determined a percentage of that executive’s base salary as a targeted level of incentive compensation opportunity, based on the Committee’s review of the Compensation Consultant’s recommendations, relevant survey data and, in the case of Named Executive Officers other than the Chief Executive Officer, the recommendations of the Chief Executive Officer. Differences in target levels of incentive compensation opportunity among the Named Executive Officers are decided by the Committee based on various factors, including competitive conditions for the Named Executive Officer’s position within the Comparator Group and in the broader employment market, as well as the Named Executive Officer’s length of employment, level of responsibility and experience. An executive’s base salary multiplied by the incentive compensation opportunity percentage establishes the target incentive compensation for which he or she is eligible. The Committee determined incentive compensation targets in 2009 for all Named Executive Officers. These incentive compensation targets were as follows:

		Target as a
		Percent of Salary				Target in Dollars
Randall J. Hogan			150	%		$	1,505,400
John L. Stauch			80	%			363,200
Michael V. Schrock			100	%			535,000
Frederick S. Koury			60	%			232,800
Louis L. Ainsworth			60	%			229,200

Actual incentive compensation awarded to each Named Executive Officer may range from 0 to 2 times the target, depending on actual company and individual performance, as described below. The Committee approves business goals (described below) for each year and sets each executive’s incentive compensation opportunity so that if we attain our annual performance goals, annual cash incentive levels will be between the 50^th and 75^th percentiles of our Comparator Group. If we attain superior performance levels, cash incentive compensation could exceed the 75^th percentile of the Comparator Group; if we do not attain any of the targeted performance goals, cash incentive compensation will be below the 50^th percentile of our Comparator Group.

          To establish the performance measures and related targets applied to EOPP payments for the Named Executive Officers, the Committee examined goals that were recommended by the Chief Executive Officer, after consultation with the Chief Financial Officer and certain other executive officers, and that were based solely on objectively determinable financial performance measures. The Committee then assessed these recommendations in light of comparable data of the Comparator Group and relevant survey data. In February 2009, the Committee established the performance goals for 2009 for both the EOPP and the more broadly-based MIP, which the Board then ratified. The EOPP performance goals, which applied to the Named Executive Officers, consisted of three quantitative measures:

	•		Free cash flow, which means cash from operating activities less capital expenditures, including both continuing and discontinued operations, plus proceeds from sale of property and equipment. For all Named Executive Officers, the 2009 free cash flow performance target was $234 million, prior to adjustments specified in the EOPP.
	•		Operating income, which means the excess of revenues over expenses for normal operating activities. For all Named Executive Officers, the 2009 operating income target was $392 million, prior to adjustments specified in the EOPP.
	•		Earnings before interest, depreciation and amortization (“EBITDA”). For all Named Executive Officers, the 2009 EBITDA target was $350 million, prior to adjustments specified in the EOPP.

          To provide an added performance incentive, the Committee determined that the amount of incentive compensation related to each performance measure other than EBITDA would be scaled according to the amount by which the measure exceeded or fell short of the target. The Committee also determined that the target measures for free cash flow and operating income should also have a threshold level below which no incentive compensation would be earned. In the case of the free cash flow and operating income performance measures, the amount of incentive compensation for each target measure was scaled from 0.75 (at the threshold) to 2.0 times (at the maximum) the measure according to a formula that was based solely on our corporate performance and was not subject to adjustment or discretion.

          In the case of EBITDA, the Committee determined that attainment of this performance goal alone would not trigger an incentive compensation award. If the EBITDA target were not attained, no award would be made at all for this performance goal. However, if the EBITDA target was attained, the Committee retained the discretion to reduce, but not to increase, the amount of any award to a Named Executive Officer, based upon a strategy deployment factor (“SDF”). The SDF factor measures an individual executive’s performance against expectations in the attainment of corporate strategic goals set by the Board. The SDF factor is determined by the Committee for each Named Executive Officer based on its assessment of individual performance following consultation with the Chief Executive Officer.

          The Committee determined that, for 2009, the performance measures applied to EOPP payments for all Named Executive Officers were to be weighted as follows: free cash flow: 40%; operating income: 40%; and EBITDA: 20%. The actual incentive compensation of each Named Executive Officer was determined by multiplying the eligible target incentive compensation amount by a multiplier determined as noted above.

          Free cash flow after adjustment for factors specified by the EOPP plan exceeded the company’s maximum target. The incentive bonus percentage for the free cash flow measure amounted to 80% of each EOPP participant’s target bonus (40% weighting times 200% at maximum).

          Operating income was $258 million after adjustment for factors specified in the EOPP plan — certain impairment and restructuring expenses. This amount was less than the Company’s threshold amount of $274 million. Therefore, no incentive bonus payment was earned with respect to the operating income measure under the EOPP.

          EBITDA for the Company after adjustment for factors specified in the EOPP plan was $357.9 million, higher than the $350 million threshold. The Compensation Committee determined that Named Executive Officer performance in 2009 met or exceeded individual performance expectations. However, due to the impact of the recession on the performance of our businesses, as well as the level of sacrifices made by all employees during 2009, management recommended and the Committee agreed to reduce the award under the EBITDA component of the EOPP. The Committee therefore used its discretion to reduce the EBITDA portion of the EOPP awards to approximately thirty percent (30%) of the award otherwise earned for the Named Executive Officers.

          Based on the foregoing, the Committee awarded EOPP incentive awards to the Named Executive Officers that are reflected in the Summary Compensation Table, column (g) “Non-Equity Incentive Plan Compensation”, on page 30.

2009 Long-term Incentive Compensation

          The Committee emphasizes executive compensation that is tied to building and sustaining our company’s value through stock performance over time. We provide long-term compensation to our executives to further the objectives of:

	•		motivating and rewarding executives through share price appreciation;
	•		encouraging innovation and growth;
	•		aligning management and shareholder interests; and
	•		attracting and retaining key executive talent.

          In keeping with this philosophy, the Committee awards participants with grants of long-term incentive compensation having a value falling between the 50^th and 75^th percentiles of competitive compensation programs, based on the Committee’s assessment of both published survey data and data from our Comparator Group. If we build and sustain long-term shareholder value through superior performance, ongoing long-term incentive values may exceed the 75^th percentile of our Comparator Group.

          In 2009, the Committee awarded long-term incentive compensation under the 2008 Pentair, Inc. Omnibus Stock Incentive Plan (the “2008 Omnibus Plan”). As it does each year, the Committee used benchmark data (including compensation surveys, Comparator Group information and other data provided by the Compensation Consultant) to set competitive target dollar award levels for each Named Executive Officer and for each position or grade level. Differences in target dollar award levels among the Named Executive Officers were decided by the Committee based on various factors, including competitive conditions for the Named Executive Officer’s position within the Comparator Group and in the broader employment market, as well as the Named Executive Officer’s length of employment, level of responsibility, experience and individual performance. Individual awards generally range between 80 and 120 percent of the target award level, with actual award amounts determined by the Committee based on its assessment of both the executive’s individual performance against his or her individual performance goals in the previous year and company performance in the previous year against our strategic plan.

          The Committee approved the elements and mix of long-term incentive compensation under the 2008 Omnibus Plan. The Committee granted all Named Executive Officers a mix of three components: stock options, restricted stock units and cash-settled performance units.

Stock options: The Committee determined that it would award ten-year stock options, with one third of the options vesting on each of the first, second and third anniversaries of the grant date, as in prior years, though the mix of stock options was reduced for the 2009 grant to 30% of the long-term incentive award’s total value.

Restricted stock units: The Committee determined that it would grant restricted stock units rather than restricted shares in 2009 in order to deliver equity awards in a more cost-effective, tax-efficient manner. Consistent with past grants of restricted shares, restricted stock units will vest one-half on each of the third and fourth anniversaries of the grant date. Each restricted stock unit represents the right to receive one share of our Common Stock upon vesting and includes one dividend equivalent unit, which, upon vesting, entitles the holder to a cash payment equal to all cash dividends declared on a share of our Common Stock from the date of grant to the date of vesting. An executive officer may elect to defer receipt of restricted stock units and receipt of payments related to dividend equivalent units upon vesting under our Non-Qualified Deferred Compensation Plan. For the 2009 grant, restricted stock units also constituted 30% of the long-term incentive award’s total value.

Cash-settled performance units: The Committee determined that it would also grant cash-settled performance units in 2009, reflecting both the high level of uncertainty in the global economic conditions facing us in 2009, as well as the unwillingness of the Committee and the Board to issue a larger number of share options or restricted stock units at unusually depressed stock prices at the beginning of 2009. Each performance unit entitles the holder to a cash payment following the end of a three-year performance period, if we achieve specified company performance goals set forth in the 2008 Omnibus Plan. The performance goals are selected by the Committee at the beginning of each year of the performance period. For 2009, the performance metric selected was achievement of an EBITDA target equal to $434.9 million.

Depending on actual cumulative company performance over the three-year performance period, the Company might pay a target of 100%, a threshold of 75%, a maximum of 125%, or a minimum of 0%, with respect to the cash-settled performance units, contingent upon the participant’s remaining employed by the Company on the third anniversary of the grant date or having retired at or after age 60 with a minimum of ten years’ service. Eligible executive officers may elect to defer receipt of the cash payment under our Non-Qualified Deferred Compensation Plan. For the 2009 grant, the value of cash-settled performance units awarded constituted 40% of the long-term incentive award’s total value.

          The value of stock options and restricted stock units granted to the Named Executive Officers in 2009 is reflected in the Grants of Plan-Based Awards Table on page 32. The value of restricted shares that vested for each Named Executive Officer in 2009 (reflecting grants made to them in 2005 and 2006) and the value of options exercised by each Named Executive Officer in 2009 are shown in the Option Exercises and Stock Vested Table on page 36.

          A range of values of the cash-settled performance units granted to the Named Executive Officers in 2009 is reflected in the Grants of Plan-Based Award Table on page 32. The valuation reflects the potential payout under these performance units at target performance levels. In 2009, the company’s EBITDA performance fell below the target level at $357.9 million, or 82% of target. Because the performance units reflect a cumulative three-year performance period, however, the results of any one year are not determinative of the amount that may be paid out at the end of the performance period. The actual value of these performance units at final payout in 2012 will reflect three-year cumulative Company performance, and may be above, below or at the target value.

          The Committee reviewed and approved the 2009 grants of long-term incentive compensation for executive officers in December 2008. For all other recipients, in February 2009, the Committee reviewed and approved grants that were effective on March 3, 2009. The Committee reviews and approves all equity awards to newly hired or promoted executives at regular meetings throughout the year. As a rule, the Committee grants awards to newly hired or promoted executives that are effective the earlier of the 15^th day of the month following the date of hire or promotion or the 15^th day of the month following the date of the Committee meeting at which the grant is approved. The Committee has also given the Committee Chair and the Chief Executive Officer discretion to grant equity awards to newly hired or promoted executives as required throughout the year, within the guidelines of the long-term incentive plan. The Committee then ratifies these grants at its next meeting. All options are granted at fair market value based on the closing stock price on the effective day of grant.

Prior Year Performance Grants

          Because sales performance and free cash flow were adversely impacted by several discretionary actions we took during 2008, after discussion and approval by the Board, the Committee considered adjustments in the results

for sales performance and free cash flow measures under the MIP and EOPP plans. These adjustments reflect the impact of Board-approved acquisitions, divestitures, and other non-recurring and unusual items, that have traditionally been taken into account in the annual MIP bonus calculations for our broader management team. These adjustments had not been contemplated at the time performance goals were set in February 2008. Following a detailed review of each item, the Committee approved these adjustments for purposes of measuring performance for our MIP for management other than EOPP participants.

          The Committee then evaluated the calculated bonuses that Named Executive Officers would have earned under the EOPP if the recommended adjustments had been made under the EOPP as well. Based on this review, the Committee approved grants of restricted shares under the 2008 Omnibus Plan for EOPP participants, including the Named Executive Officers, in an amount equal to the incremental difference between (1) the bonuses that would have been earned under the EOPP if the recommended adjustments had been made under the EOPP, and (2) the approved EOPP awards without taking into account the recommended adjustments. These awards were granted on March 3, 2009, and valued at the closing stock price on that date, and they will vest one-half on the first anniversary, and one-quarter on the second and third anniversaries, of the date of grant. The number of restricted shares granted to each of the Named Executive Officers was as follows: Mr. Hogan — 19,594 shares, Mr. Stauch — 4,727 shares, Mr. Schrock — 6,963 shares, Mr. Koury — 3,030 shares, and Mr. Ainsworth — 2,983 shares.

Changes in Compensation Program Mix for 2010

          The Committee believes that one of the strengths of our compensation program is its consistency; therefore, the Committee did not change in 2009 its compensation philosophy or objectives as described on page 15 above. In light of recent economic and market conditions, however, the Committee did revise the mix of elements of the compensation program for the Named Executive Officers and the broader management team for 2010. After review of our short- and long-term incentive plans, our preliminary 2010 operating plan, our financial position and current market trends for executive compensation prepared by the Compensation Consultant, management and the Committee modified our compensation program from that in 2009 as follows:

	•		to reinstate merit-based salary increases for all management levels effective during 2010;
	•		to reinstate contributions for all participants in the Company’s ESOP, 401(k) and deferred compensation plans in 2010; and
	•		to eliminate the use of cash-settled performance units as a part of long-term incentive compensation mix for 2010.

          The Committee believes that these changes will both enable the Company to retain and attract talented management and to further management alignment with shareholder interests.

          Base Salaries

          The Committee undertook its annual review of base salaries for the Named Executive Officers and other management personnel, in accordance with its normal procedures. Following a market review by the Compensation Consultant, the Committee, with the Board’s concurrence, adopted the Chief Executive Officer’s recommendation to reinstate merit-pay salary increases for upper management personnel in April 2010, and for all executive officers, including all Named Executive Officers, in July 2010.

          Base salaries for most upper level management personnel and all Named Executive Officers had been frozen in 2009 at 2008 levels. In addition, the Chief Executive Officer agreed to forego payment of 10% of his base salary in May 2009. His salary will revert to the prior salary level in April 2010.

          Annual Incentive Compensation

          The Committee also reviewed the Company’s cash incentive plans and approved performance measures and goals for 2010. The Committee determined that organic sales growth, operating income and cash flow generation would be the three primary operating measures used to determine cash incentive compensation amounts for 2010. These measures correlate strongly with two primary corporate objectives: to improve the financial return from our businesses, and to strengthen our balance sheet through cash flow improvement and debt reduction. In

addition, the Committee also approved an EBITDA target to be used with SDF factors in assessing individual performance for the year. The performance measures (and related target amounts) applicable to all Named Executive Officers for 2010 will be weighted as follows: organic sales growth 30%, operating income 30%, cash flow 20% and EBITDA (SDF) 20%.

          No changes are being made in the administration of the EOPP, the setting of incentive compensation opportunity targets, the methodology for calculating actual incentive compensation payouts or the Committee’s procedures for reviewing and approving awards under the plan, as described above on pages 17 — 22.

          Long-term Incentive Compensation

          The Committee approved in December 2009 the elements and mix of long-term incentive compensation for 2010 under the 2008 Omnibus Plan. The Committee granted all Named Executive Officers stock options and restricted stock units. The Committee determined that the value of stock options and restricted stock units would each represent 50% of the total value of long-term incentive compensation granted to Named Executive Officers, reducing the allocation of stock options compared to restricted stock units awards in order to emphasize longer-term value creation. The Committee also determined not to award new cash-settled performance units as in 2009 reflecting both the changes in the global economic conditions facing us in 2010 compared to 2009, and the decision by the Committee not to issue the larger number of shares in 2009 that would have been called for as long-term incentive compensation under normal Company policy, as a result of the depressed stock price at the beginning of 2009 compared to 2010.

          With respect to cash-settled performance units granted in 2009, the Committee determined that the performance metric under those units would again be EBITDA realized by the Company in 2010, as it was in 2009. For 2010, the target EBITDA was set by the Committee at $420 million.

Stock Ownership Guidelines

          The Committee and the Board have established stock ownership guidelines for the Named Executive Officers and other executives to motivate them to become significant shareholders and to further encourage long-term performance and growth. The Committee monitors our executives’ compliance with these stock ownership guidelines and periodically reviews the definition of “stock ownership” to reflect the practices of companies in the Comparator Group. For 2009, “stock ownership” included stock owned by the officer both directly and indirectly, the pro-rated portion of unvested restricted stock, restricted stock units, and shares held in our employee stock ownership plan or our employee stock purchase plan. The Committee determined that, over a period of five years from appointment, key employees should accumulate and hold Common Stock equal to a multiple of base salary as follows:

		Stock Ownership Guidelines
Executive Level		(as a multiple of salary)
Chief Executive Officer		5x base salary
President, Chief Operating Officer; Executive Vice President and Chief Financial Officer		3x base salary
Senior Vice President, Human Resources; Senior Vice President and General Counsel		2.5x base salary
Other key executives		2x base salary

Stock Ownership for the Currently-Serving Named Executive Officers as of December 31, 2009

		Share				12/31/09				Ownership				Meets
		Ownership				Market Value				Guideline				Guideline
Randall J. Hogan			552,838			$	17,856,667			$	4,683,467			Yes
John L. Stauch			44,604				1,440,709				1,362,000			Yes
Michael V. Schrock			116,491				3,762,659				1,605,000			Yes
Frederick S. Koury			40,070				1,294,261				970,000			Yes
Louis L. Ainsworth			140,053				4,523,712				955,000			Yes

Retirement and Other Benefits

          The Named Executive Officers and other executives and employees participate in the Pentair, Inc. Pension Plan, the Pentair Retirement Savings and Stock Incentive Plan, the Pentair Supplemental Executive Retirement Plan and the Pentair Restoration Plan. We also provide other benefits such as medical, dental and life insurance and disability coverage to employees, including the Named Executive Officers. We aim to provide employee and executive benefits at levels that reflect competitive market levels at the 50^th percentile of similar benefits given by our Comparator Group.

          The Pentair, Inc. Pension Plan, the Pentair Retirement Savings and Stock Incentive Plan, the Pentair Supplemental Executive Retirement Plan and the Pentair Restoration Plan were all amended in 2008 to comply with final regulations under Internal Revenue Code Section 409A. As a result of these amendments, benefits vested prior to January 1, 2005 are separated from benefits earned after January 1, 2005, and may offer different distribution or other options to participants as described below.

The Pentair, Inc. Pension Plan

          The Pentair, Inc. Pension Plan (the “Pension Plan”) is a funded, tax-qualified, noncontributory defined-benefit pension plan that covers certain employees, including the Named Executive Officers. Participation in the Pension Plan is restricted to those Named Executive Officers and other employees who were hired on or before December 31, 2007. Benefits under the Pension Plan are based upon an employee’s years of service and highest average earnings in any five-year period during the ten-year period preceding the employee’s retirement (or, in the case of an employee with more than five years but less than ten years of service, during any five-year period preceding the employee’s retirement). No additional benefits may be earned under the Pension Plan after December 31, 2017. Benefits under the Pension Plan are payable after retirement in the form of an annuity.

          Compensation covered by the Pension Plan for the Named Executive Officers equals the amounts set forth in the “Salary” column of the Summary Compensation Table on page 30 and 2008 incentive compensation paid in March 2009 set forth in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table on page 30. The amount of annual earnings that may be considered in calculating benefits under the Pension Plan is limited by law. For 2009, the annual limitation was $245,000.

          Benefits under the Pension Plan are calculated as an annuity equal to the sum of:

	•		1.0 percent of the participant’s highest final average earnings multiplied by years of service; and
	•		0.5 percent of such earnings in excess of Primary Social Security compensation.

          Years of service under these formulas cannot exceed 35. Contributions to the Pension Plan are made entirely by us and are paid into a trust fund from which the benefits for all participants will be paid.

The Pentair Supplemental Executive Retirement and Restoration Plan

          The Pentair Supplemental Executive Retirement Plan (“SERP”) and the Pentair Restoration Plan (“Restoration Plan”) are unfunded, nonqualified defined benefit pension plans for all executive officers and other key executives selected by the Committee who were hired on or before December 31, 2007. Benefits under these two Plans vest upon the completion of five years of benefit service (all service following initial participation). These Plans are combined for all administrative, accounting and other purposes. The Named Executive Officers all participate in the SERP and the Restoration Plan. Each Named Executive Officer other than Mr. Stauch is fully vested in these Plans.

          Benefits under the SERP are based upon the number of an employee’s years of service following initial participation and the highest average earnings for a five calendar-year period (ending with retirement). Benefits

vested as of December 31, 2004, are payable after retirement in the form of either a 15-year certain annuity or, at the participant’s option, a 100% joint and survivor annuity. Benefits earned after December 31, 2004, are payable after retirement in the form of a 15-year certain annuity. No additional benefits may be earned under the Pension Plan after December 31, 2017. Compensation covered by the SERP and the Restoration Plan for the Named Executive Officers equals the amounts set forth in the 2009 “Salary” and “Non-Equity Incentive Plan Compensation” columns of the Summary Compensation Table on page 30.

          Benefits under the SERP are calculated as:

	•		final average compensation as defined above; multiplied by
	•		benefit service percentage, which equals 15% multiplied by years of benefit service.

          As discussed above, the Pension Plan limits retirement benefits for compensation earned in excess of the annual limitation imposed by Internal Revenue Code Section 401(a)(17), which was $245,000 in 2009. The Restoration Plan is designed to provide retirement benefits based on compensation earned by participants in excess of this annual limitation. Only executive officers and key executives hired on or before December 31, 2007 are eligible to participate in the Restoration Plan.

          The only participants in the Restoration Plan are those executive officers and other selected key leaders who participate in the SERP. Restoration Plan benefits are combined and administered with those payable under the SERP and are paid in the same manner and at the same time.

          Benefits under the Restoration Plan are calculated as:

	•		final average compensation as defined above, less compensation below the annual limitation amount in each year; multiplied by
	•		earned benefit service percentage (which is weighted based on age at the time of service), in accordance with the following table:

Service Age		Percentage
Under 25			4	%
25-34			5.5	%
35-44			7	%
45-54			9	%
55 or over			12	%

The benefit percentages calculated above are added and the resulting percentage is multiplied by the covered compensation amount. Benefits vested as of December 31, 2004 are payable after retirement in the form of a 15-year certain annuity or, at the participant’s option, a 100% joint and survivor annuity. Benefits earned after December 31, 2004 are payable after retirement in the form of a 15-year certain annuity. No additional benefits may be earned under the Restoration Plan after December 31, 2017.

          The present value of the combined accumulated benefits for the Named Executive Officers under both the SERP and the Restoration Plan is set forth in the Pension Benefits table on page 36.

The Pentair Retirement Savings and Stock Incentive Plan

          The Pentair Retirement Savings and Stock Incentive Plan (“RSIP/ESOP Plan”) is a tax-qualified 401(k) retirement savings plan, with a companion Employee Stock Ownership Plan (“ESOP”) component. Participating employees may contribute up to 50 percent of base salary and incentive compensation on a before-tax basis and 15 percent of compensation on an after-tax basis, into their 401(k) plan (“RSIP”). We normally match an amount equal to one dollar for each dollar contributed to the RSIP by participating employees on the first one percent, and 50 cents for each dollar contributed to the RSIP by participating employees on the next five percent, of their regular earnings. In addition, after the first year of employment, we contribute to the ESOP an amount equal to 1 ¹/2 % of cash compensation (salary and incentive compensation) for each participant in the RSIP, to incent employees to make contributions to our retirement plan. The RSIP/ESOP Plan limits the amount of cash compensation considered for contribution purposes to the maximum imposed by Internal Revenue Code Section 401(a)(17), which was $245,000 in 2009.

          Participants in the RSIP/ESOP Plan are allowed to invest their account balances in a number of possible mutual fund investments. Our Common Stock is not a permitted investment choice under the RSIP. We make ESOP contributions in our Common Stock. Participants may sell and immediately reinvest stock contributions within the ESOP into any other investment vehicles offered under the RSIP/ESOP Plan. In addition, ESOP balances, but not RSIP balances, may be reinvested into the Company’s Common Stock, effective in 2009.

          Fidelity Investments Institutional Services Co. provides these investment vehicles for participants and handles all allocation and accounting services for the Plan. We do not guarantee or subsidize any investment earnings under the Plan.

          Amounts deferred, if any, under the RSIP/ESOP Plan by the Named Executive Officers are included in the “Salary” and “Non-Equity Incentive Plan Compensation” columns of the Summary Compensation Table on page 30. Pentair matching contributions allocated to the Named Executive Officers under the RSIP/ESOP Plan are included in the “All Other Compensation” column of the Summary Compensation Table. Matching contributions are generally made a year in arrears.

          The Company determined to temporarily suspend in June 2009 all matching contributions to participant accounts under the RSIP/ESOP Plan as a result of worsening economic conditions and uncertainty about future company performance. The company reinstated matching contributions to participant accounts in 2010, effective January 1 for the ESOP and April 1 for the RSIP. All Named Executive Officers were subject to the suspension of contributions in 2009 and will benefit from their reinstatement on the same basis as other participants in 2010.

Medical, Dental, Life Insurance and Disability Coverage

          Employee benefits such as medical, dental, life insurance and disability coverage are available to all U.S.-based participants through our active employee plans. In addition to these benefits to active employees, we provide post-retirement medical, dental and life insurance coverage to certain retirees in accordance with the legacy company plans which applied at the time the employees were hired. We provide up to one and a half times annual salary (up to $2,000,000) in life insurance, and up to $10,000 per month in long-term disability coverage. The cost of the active employee benefits in 2009 for the Named Executive Officers was as follows:

		Cost of
Officer		Benefits
Randall J. Hogan		$	13,122
John L. Stauch		$	13,138
Michael V. Schrock		$	12,739
Frederick S. Koury		$	12,309
Louis L. Ainsworth		$	9,313

The value of these benefits is not required to be included in the Summary Compensation Table since they are made available to all of our U.S. salaried employees.

Other Paid Time-Off Benefits

          We also provide vacation and other paid holidays to all employees, including the Named Executive Officers, which we have determined to be comparable to those provided at other large companies.

Deferred Compensation

          We sponsor a non-qualified deferred compensation program, called the Sidekick Plan, for our U.S. executives within or above the pay grade that has a median annual salary of $118,700 in 2009. This plan permits executives to defer up to 25% of their base salary and 100% of their annual cash incentive compensation. We normally make contributions in two tranches to the Sidekick Plan on behalf of participants similar to our contributions under the RSIP/ESOP Plan with respect to each participant’s contributions from that portion of his or her income above the maximum imposed by Internal Revenue Code Section 401(a)(17), which was $245,000 in 2009, but below the Sidekick Plan’s compensation limit of $700,000.

          Participants in the Sidekick Plan are allowed to invest their account balances in a number of possible mutual fund investments. Fidelity Investments Institutional Services Co. provides these investment vehicles for participants and handles all allocation and accounting services for the Plan. We do not guarantee or subsidize any investment earnings under the Plan, and our Common Stock is not a permitted investment choice under the Plan.

          Amounts deferred, if any, under the Sidekick Plan by the Named Executive Officers are included in the “Salary” and “Non-Equity Incentive Plan Compensation” columns of the Summary Compensation Table on page 30. Our contributions allocated to the Named Executive Officers under the Sidekick Plan are included in the “All Other Compensation” column of the Summary Compensation Table.

          The Company determined to temporarily suspend in May and June 2009 the matching contributions to participant accounts under the Sidekick Plan as a result of worsening economic conditions and uncertainty about future company performance. The company determined to reinstate matching contributions at the beginning of 2010, effective in January and April. All Named Executive Officers were subject to the suspension of contributions in 2009 and will benefit from their reinstatement on the same basis as other participants in 2010.

Perquisites and Other Personal Benefits

          We provide Named Executive Officers with a perquisite program (the “Flex Perq Program”) under which the Named Executive Officers receive a cash perquisite allowance in an amount that the Committee believes is customary, reasonable and consistent with our overall compensation program to better enable us to attract and retain superior employees for key positions. The Committee periodically reviews market data provided by the Compensation Consultant to assess the levels of perquisites provided to Named Executive Officers.

          For 2009, the total aggregate annual allowance under the Flex Perq Program was $35,000 for the Chief Executive Officer and the President and Chief Operating Officer, and $30,000 for all other participants. In addition to the allowance provided under the Flex Perq Program, we provided reimbursement for an annual executive physical and related expenses for the Chief Executive Officer.

          These amounts are included in the Summary Compensation Table, in the column labeled “All Other Compensation,” on page 30 and are set forth in more detail in footnote 5 to that table.

Severance and Change-in-Control Benefits

          We provide severance and change-in-control benefits to selected executives to provide for continuity of management upon a threatened or completed change in control. These benefits are designed to provide economic protection to key executives following a change in control of our company so that our executives can remain focused on our business without undue personal concern. We believe that the security that these benefits provide helps our key executives to remain focused on our on-going business and reduces the key executive’s concerns about future employment. We also believe that these benefits allow our executives to consider the best interests of our company and its shareholders due to the economic security afforded by these benefits.

          We provide the following severance and change-in-control benefits:

	•		We have entered into agreements with our key corporate executives and other key leaders (including all Named Executive Officers) that provide for contingent benefits upon a change in control.
	•		The EOPP and the MIP each provide that, upon a change in control, each EOPP or MIP participant is entitled to receive any outstanding and unpaid award for the year before the change of control as well as an award for the then-current year calculated on the basis of the executive’s base salary immediately before the change of control and assuming that the year’s EOPP or MIP targets have been attained.
	•		The 2008 Omnibus Plan and its predecessors provide that, upon a change in control, all outstanding options granted under such plans that are unvested become fully vested.
	•		The 2008 Omnibus Plan and its predecessors provide that, upon a change in control, all restrictions applicable to outstanding shares of restricted stock granted under such plans shall automatically lapse and any dividends declared but unpaid with respect to such restricted stock shall be paid to the executive within 10 days of the date of the change of control.
	•		The 2008 Omnibus Plan and its predecessors provide that, upon a change in control, all restrictions applicable to outstanding restricted stock units and dividend equivalent units granted under the Plan shall automatically lapse and any dividends declared but unpaid with respect to such dividend equivalent units shall be paid to the executive within 10 days of the date of the change of control.
	•		The 2008 Omnibus Plan provides that, upon a change in control, all cash-settled performance units for which the performance period has not expired will be cancelled in exchange for a cash payment equal to the amount that would have been due under such awards if the performance goals measured at the time of the change of control were to continue to be achieved at the same rate through the end of the performance period, or if higher, assuming the target performance goals had been met at the time of the change of control.
	•		Upon certain types of terminations of employment (other than a termination following a change in control), severance benefits may be paid to the Named Executive Officers at the discretion of the Committee.

          We explain these benefits more fully under “Potential Payments Upon Termination Or Change In Control” on page 38.

Retention Agreements

          We entered into a Confidentiality and Non-Competition Agreement dated as of January 6, 2005, with Michael Schrock, our President and Chief Operating Officer. The Confidentiality and Non-Competition Agreement requires Mr. Schrock to devote his full-time and energy to furthering our business and prohibits Mr. Schrock, during or after his term of employment, from disclosing or using, for his own benefit or the benefit of another party, confidential information that he may learn or acquire during his employment. The Confidentiality and Non-Competition Agreement also contains a covenant against competition by Mr. Schrock for two years following his last day of employment with us. It does not contain severance provisions.

Impact of Tax Considerations

          Section 162(m) of the Internal Revenue Code places a limit of $1,000,000 on the amount of compensation that we may deduct in any one year with respect to each of our five most highly paid executive officers. There is an exception to the $1,000,000 limitation for performance-based compensation meeting certain requirements, including periodic shareholder approval of the benefit plans under which we pay such performance-based compensation. Annual cash incentive compensation generally is performance-based compensation meeting those requirements and, as such, is fully deductible.

          The Committee also considers the impact of other tax provisions, such as the restrictions on deferred compensation set forth in Section 409A of the Internal Revenue Code, and attempts to structure compensation in a tax-efficient manner, both for the Named Executive Officers and for our company. To maintain flexibility in compensating executive officers in a manner designed to promote varying corporate goals, the Committee has not adopted a policy requiring all compensation to be deductible.

COMPENSATION COMMITTEE REPORT

          The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis set forth above with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2009.

THE COMPENSATION COMMITTEE:

David A. Jones, Chair
Glynis A. Bryan
T. Michael Glenn
William T. Monahan

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

          The table below summarizes the total compensation paid to or earned by each of the Named Executive Officers for the fiscal years ended December 31, 2007, 2008 and 2009.

(a)		(b)				(c)				(d)				(e)				(f)				(g)				(h)				(i)				(j)
																										Change in
																										Pension Value
																										and Non-
																										Qualified
																						Non-Equity				Deferred				All Other
														Stock				Option				Incentive Plan				Compensation				Compensa				Total
Name and						Salary				Bonus				Awards				Awards				Compensation				Earnings				tion				Compensation
Principal Position		Year				($)				($)				($) (1)				($) (2)				($) (3)				($) (4)				($) (5)				($)
Randall J. Hogan			2009				936,693				0				1,955,544				1,706,806				1,264,536				1,138,773				186,633				7,188,985
Chairman and Chief Executive Officer			2008				1,003,600				0				1,615,005				2,499,908				525,155				566,922				203,771				6,414,361
			2007				965,000				0				1,419,866				3,644,808				1,814,876				643,468				200,209				8,688,227
John L. Stauch			2009				454,000				0				1,618,536				524,258				319,616				274,029				98,333				3,288,772
Executive Vice President and Chief Financial Officer			2008				454,000				0				546,880				843,930				130,207				139,651				67,339				2,182,007
			2007				382,865				0				616,400				1,177,240				384,029				207,697				47,978				2,816,209
Michael V. Schrock			2009				535,000				0				770,048				698,813				470,800				550,917				158,454				3,184,032
President and Chief Operating Officer			2008				535,000				0				649,420				1,005,214				171,735				237,198				147,366				2,745,933
			2007				517,000				0				601,000				988,619				648,214				321,697				141,004				3,217,534
Frederick S. Koury			2009				388,000				0				355,324				331,110				214,176				236,751				87,276				1,612,637
Senior Vice President, Human Resources			2008				388,000				0				341,800				525,112				83,459				124,626				73,988				1,536,985
			2007				371,171				0				285,475				523,946				279,225				108,042				87,175				1,655,034
Louis L. Ainsworth			2009				382,000				0				304,865				275,925				197,112				268,713				85,639				1,514,254
Senior Vice President, General Counsel and Secretary			2008				382,000				0				290,530				435,093				82,168				172,066				69,082				1,430,939
			2007				363,693				0				225,375				622,860				262,688				152,166				73,930				1,700,712

		(a)				(b)				(c)				(d)				(e)				(f)
														Matches
		Perquisites				Other				Matches				under the
		under the				Perquisites				under Defined				Employee				Life				Dividends on
		Flex Perq				and Personal				Contribution				Stock				Insurance				Restricted
		Program				Benefits				Plans				Purchase Plan				Premiums				Stock Awards
Name		($)(a)				($)				($)				($)				($)				($)
Mr. Hogan			35,000				5,805				37,525				0				2,553				105,750
Mr. Stauch			30,000				0				37,825				1,800				1,135				27,573
Mr. Schrock			35,000				0				37,563				2,250				3,884				79,757
Mr. Koury			30,000				0				37,567				375				958				18,376
Mr. Ainsworth			30,000				0				35,542				0				4,142				15,955

GRANTS OF PLAN-BASED AWARDS

Estimated Future Payouts Under Non- Equity Incentive Plan Awards (2)

Estimated Future Payouts Under Equity Incentive Plan Awards (3)

(a)

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

(j)

(k)

(l)

(m)

All Other

All Other

Stock

Option

Awards:

Awards:

Exercise

Grant Date

Number

Number of

or Base

Fair Value

Compensation

of Shares

Securities

Price of

of Stock

Committee

of Stock

Underlying

Option

and Option

Grant

Approval

Threshold

Target

Maximum

Threshold

Target

Maximum

or Units

Options

Awards

Awards

Name

Date

Date (1)

($)

($)

($)

(#)

(#)

(#)

(#) (4)

(#)(5)

($/sh)

($)(6)

Randall J. Hogan

1/2/2009

12/15/2008

63,791

1,580,741

1/2/2009

12/15/2008

309,288

24.78

1,706,806

3/3/2009

2/23/2009

19,594

374,833

1/2/2009

12/15/2008

1,675,810

2,234,413

2,793,016

N/A

N/A

1,129,050

1,505,400

3,010,800

John L. Stauch

1/2/2009

12/15/2008

61,667

1,528,108

1/2/2009

12/15/2008

95,000

24.78

524,257

3/3/2009

2/23/2009

4,727

90,428

1/2/2009

12/15/2008

486,094

648,125

810,156

N/A

N/A

272,400

363,200

726,400

Michael V. Schrock

1/2/2009

12/15/2008

25,700

636,846

1/2/2009

12/15/2008

125,000

24.78

689,812

3/3/2009

2/23/2009

6,963

133,202

1/2/2009

12/15/2008

765,525

1,020,700

1,275,875

N/A

N/A

401,250

535,000

1,070,000

Frederick S. Koury

1/2/2009

12/15/2008

12,000

297,360

1/2/2009

12/15/2008

60,000

24.78

331,110

3/3/2009

2/23/2009

3,030

57,964

1/2/2009

12/15/2008

287,625

383,500

479,375

N/A

N/A

174,600

232,800

465,600

Louis L. Ainsworth

1/2/2009

12/15/2008

10,000

247,800

1/2/2009

12/15/2008

50,000

24.78

275,925

3/3/2009

2/23/2009

2,983

57,065

1/2/2009

12/15/2008

347,925

463,900

579,875

N/A

N/A

171,900

229,200

458,400

OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2009

		Option Awards																				Stock Awards
																														Equity				Equity incentive
										Equity																				incentive				plan
										incentive																				plan				awards:
										plan												Number								awards:				Market
										awards:												of				Market				Number				or payout
						Number of				Number of												Shares				value of				of				value of
		Number of				securities				securities												of stock				shares of				unearned				unearned
		securities				Underlying				underlying												or units				stock or				shares				shares
		underlying				options				unexercised				Option								that have				units that				that have				that have
		options				granted				unearned				exercise				Option				not been				have not				not				not
		(#)				(#)				options				price				expiration				vested				vested				vested				vested
Name		Exercisable				Unexercisable				(#)				($)(1)				date				(#)(2)				($)(3)				(#)				($)
Randall J. Hogan																							215,385			$	6,956,935
			158,667				—							$	11.3750				1/2/2011
			244,706				—							$	18.1485				1/2/2012
			4,659				—							$	16.2735				1/2/2011
			300,000				—							$	22.8800				1/2/2014
			47,007				—							$	40.8000				1/3/2010
			275,000				—							$	40.9500				1/6/2015
			200,000				—							$	34.2800				1/3/2016
			213,183				106,592	(4)						$	30.0500				1/3/2017
			115,624				—							$	35.9900				1/2/2013
			111,083				222,167	(5)						$	34.1800				1/2/2018
			—				309,288	(6)						$	24.7800				1/2/2019
John L. Stauch																							101,144			$	3,266,951
			80,666				40,334	(7)						$	33.0100				2/15/2017
			8,333				4,167	(8)						$	31.5600				3/1/2017
			37,500				75,000	(5)						$	34.1800				1/2/2018
			—				95,000	(6)						$	24.7800				1/2/2019
Michael V. Schrock																							137,938			$	4,455,397
			73,602				—							$	22.8800				1/2/2014
			11,690				—							$	26.2650				1/2/2011
			10,023				—							$	32.4900				1/3/2010
			16,991				—							$	32.4900				10/22/2011
			60,000				—							$	40.9500				1/6/2015
			6,662				—							$	41.4300				10/22/2011
			29,786				—							$	41.4300				1/2/2012
			17,991				—							$	41.4300				1/2/2013
			7,951				—							$	41.4300				1/2/2014
			68,000				—							$	34.2800				1/3/2016
			73,333				36,667	(4)						$	30.0500				1/3/2017
			10,132				—							$	36.7800				1/2/2013
			44,666				89,334	(5)						$	34.1800				1/2/2018
			—				125,000	(6)						$	24.7800				1/2/2019
Frederick S. Koury																							38,280			$	1,236,444
			20,000				—							$	20.5350				9/9/2013
			35,000				—							$	22.8800				1/2/2014
			25,000				—							$	40.9500				1/6/2015
			27,777				—							$	34.2800				1/3/2016
			27,083				21,667	(4)						$	30.0500				1/3/2017
			23,333				46,667	(5)						$	34.1800				1/2/2018
			—				60,000	(6)						$	24.7800				1/2/2019
Louis L. Ainsworth																							32,835			$	1,060,570
			70,000				—							$	22.8800				1/2/2014
			9,727				—							$	33.9700				1/3/2010
			8,751				—							$	40.8000				1/3/2010
			50,000				—							$	40.9500				1/6/2015
			5,476				—							$	41.4400				1/2/2011