Exhibit 10.30
EXECUTIVE CONSULTING AGREEMENT
THIS AGREEMENT is made this 26th day of June, 2002, between Pentair,
Inc., a Minnesota corporation ("Pentair"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇").
WHEREAS, ▇▇▇▇▇▇ has served as Chief Executive Officer, Chairman and
Director of Pentair, and
WHEREAS, ▇▇▇▇▇▇ and Pentair wish to arrange a transition period during
which ▇▇▇▇▇▇ will cease employment with Pentair, but continue to provide
services as Chairman of the Board prior to retirement from the Pentair Board of
Directors; and
WHEREAS, Pentair wishes to assure itself of the availability of the
services of ▇▇▇▇▇▇ during this transition period, and to obtain reasonable
protection of its confidential business information, together with assurance
▇▇▇▇▇▇ will not compete with Pentair during the term of this Agreement or at any
time thereafter; and
WHEREAS, Pentair and ▇▇▇▇▇▇ wish to set forth in writing the terms and
conditions which shall apply during this transition period;
NOW, THEREFORE, in consideration of the foregoing premises and the
consideration as detailed below, Pentair and ▇▇▇▇▇▇ hereby agree as follows:
1. Retirement Schedule. Effective as of January 1, 2001, ▇▇▇▇▇▇ shall
retire as Chief Executive Officer of Pentair, and effective as of May 1, 2001,
▇▇▇▇▇▇ shall retire as a full-time employee of Pentair and from such other
positions or offices as he may hold with Pentair or with any other company which
is a member of the controlled group of companies which includes Pentair
(collectively, the "Group") as shown on the attached Exhibit ▇. ▇▇▇▇▇▇ shall
continue to serve as Chairman of the Board of Directors of Pentair (the "Board")
until the date of the 2002 Pentair annual shareholders meeting, at which time he
shall retire as a Board member and cease to serve as Chairman of the Board.
▇▇▇▇▇▇, together with the Chief Executive Officer of Pentair and the Chairman of
the Compensation Committee of the Board shall develop a description of the
duties and responsibilities to be assumed by ▇▇▇▇▇▇ as Chairman of the Board.
2. Compensation. (a) Salary. Through April 30, 2001, Pentair shall
continue to compensate ▇▇▇▇▇▇ at the same annual salary rate as was in effect on
January 1, 2001. Beginning May 1, 2001 and ending on April 30, 2002, Pentair
shall compensate ▇▇▇▇▇▇ for services rendered as Chairman of the Board at sixty
percent (60%) of his annual salary rate as in effect on May 1, 2001. Except as
otherwise provided in this Agreement, these payments shall be in lieu of any
compensation, fees or other benefits to which ▇▇▇▇▇▇ might otherwise be entitled
as a non-employee member of the Board.
All compensation provided hereunder shall continue to be paid to ▇▇▇▇▇▇
in the event of his disability or incapacity prior to May 1, 2002, or to
▇▇▇▇▇▇'▇ estate in the event of his death prior to May 1, 2002.
(b) Bonus. (i) Bonus During Employment. ▇▇▇▇▇▇ shall remain eligible to
receive a bonus under the Pentair Executive Officer Performance Plan ("EOPP"),
as then in effect with respect to the Pentair Chief Executive Officer, for
services rendered as an employee of Pentair through April 30, 2001. Such bonus,
if any, as ▇▇▇▇▇▇ may earn under the EOPP shall be pro-rated based on his status
as a full-time employee of Pentair for the period beginning January 1, 2001 and
ending April 30, 2001. Any bonus so earned shall be calculated and paid in 2002
in accordance with applicable provisions of the EOPP.
(ii) Bonus After Employment. ▇▇▇▇▇▇ shall be eligible to receive a
bonus for such time in 2001 as he is rendering services as a non-employee
Chairman of the Board. Such bonus shall be equivalent to the bonus, if any,
▇▇▇▇▇▇ would have been eligible to earn under the EOPP as in effect when his
employment ended, prorated to cover only those months in 2001 that ▇▇▇▇▇▇
continues to serve as Chairman of the Board, and to reflect the fact that ▇▇▇▇▇▇
is deemed to provide services at the rate of sixty percent (60%) of full-time.
Such prorated bonus as ▇▇▇▇▇▇ may earn for the period from May 1, 2001 through
December 31, 2001 shall be calculated and paid in 2002 in the same manner and at
the same time as the bonus earned while ▇▇▇▇▇▇ was an EOPP participant.
(c) Stock and Equity Awards. ▇▇▇▇▇▇ shall be entitled to receive a
grant of stock options for 2001 consistent with the award made to the Pentair
Chief Executive Officer under the Pentair, Inc. Omnibus Stock and Incentive Plan
(the "Omnibus Plan") in accordance with the terms and conditions determined at
the time of said grant. For 2002, ▇▇▇▇▇▇ shall be entitled to receive a grant of
stock options, which award shall be consistent with the award made to the then
Pentair Chief Executive Officer in 2002 under the Omnibus Plan, and which shall
be subject to such terms and conditions as shall be determined at the time of
said grant.
3. Benefits. Effective April 30, 2001, ▇▇▇▇▇▇ shall cease to
participate in the various benefit plans made available by Pentair to its
employees, subject to such rights as are described below:
(a) Retirement Benefits. (i) Pentair Pension Plan. ▇▇▇▇▇▇ shall remain
eligible to accrue benefits under the Pentair Pension Plan through April 30,
2001, at which time the vested accrued benefit payable to ▇▇▇▇▇▇ under such plan
shall be determined. ▇▇▇▇▇▇ shall be entitled to receive payment of such vested
accrued benefit in accordance with the provisions of said plan.
(ii) Retirement Savings and Stock Incentive Plan ("RSIP"). ▇▇▇▇▇▇ shall
remain a participant in RSIP and shall be eligible to authorize deposits to such
plan through April 30, 2001. ▇▇▇▇▇▇ shall be entitled to share in allocations of
contributions made by Pentair, including matching and employer discretionary
contributions payable on account of service completed by, deferrals authorized
by, or compensation paid to, ▇▇▇▇▇▇ through April 30, 2001, to the extent
required by the provisions of RSIP. For this purpose, no payments made to ▇▇▇▇▇▇
under this Agreement shall be included as covered compensation. ▇▇▇▇▇▇ shall be
entitled to receive payment of his vested accrued benefit under RSIP in
accordance with applicable provisions of RSIP.
(iii) Non-Qualified Deferred Compensation Plan ("Sidekick"). ▇▇▇▇▇▇
shall remain a participant in Sidekick and shall be eligible to authorize
deposits to such plan through April 30, 2001. ▇▇▇▇▇▇ shall be entitled to share
in allocations of contributions made by Pentair, including
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matching and employer discretionary contributions payable on account of service
completed by, deferrals authorized by, or compensation paid to, ▇▇▇▇▇▇ through
April 30, 2001, to the extent required by the provisions of Sidekick. For this
purpose, no payments made to ▇▇▇▇▇▇ under this Agreement shall be included as
covered compensation. ▇▇▇▇▇▇ shall be entitled to payment of the amounts payable
to him under Sidekick in accordance with the payment election made by him at the
time he became a Sidekick participant.
(b) Supplemental Retirement Plan. Effective May 1, 2001, ▇▇▇▇▇▇ shall
cease to accrue benefits under the 1988 Supplemental Executive Retirement Plan
and, except as otherwise provided in this Agreement, any other non-tax qualified
retirement or deferred compensation arrangement sponsored by Pentair or any
other Group member. Such supplemental retirement benefits as shall be paid to
▇▇▇▇▇▇ are described in the Retirement Agreement and Release executed by ▇▇▇▇▇▇
and Pentair on June 26, 2002.
(c) Insurance Benefits. (i) Medical, Dental and Life Insurance. ▇▇▇▇▇▇
shall remain eligible to participate in the various medical, dental, life and
disability insurance benefits offered by Pentair to its executive employees
through April 30, 2001. Beginning May 1, 2001, ▇▇▇▇▇▇ may elect to continue
participation in the group medical, dental and life insurance programs
consistent with his rights to continuation coverage under applicable state and
federal law. Said continuation period shall end on the earlier of the date
▇▇▇▇▇▇ is eligible for coverage with a subsequent employer or the expiration of
eighteen (18) months (i.e., October 31, 2002). During the applicable
continuation period, Pentair shall pay the entire cost of providing such
continuation coverage. Such insurance benefits as will be available to ▇▇▇▇▇▇
following the continuation period are described in the Retirement Agreement and
Release executed by ▇▇▇▇▇▇ and Pentair on June 26, 2002.
(ii) Supplemental Life and Disability Insurance. To the extent he has
elected coverage under the supplemental disability and life insurance plans made
available by Pentair to its executive employees, ▇▇▇▇▇▇ shall retain such
coverage through April 30, 2001, after which time if ▇▇▇▇▇▇ shall elect to
retain these coverages, Pentair shall reimburse ▇▇▇▇▇▇ for the cost of such
coverages.
(iii) Flexible Benefits Plan. Beginning May 1, 2001, ▇▇▇▇▇▇ shall be
offered the opportunity to continue participation in the Pentair Flexible
Benefits Plan consistent with the terms and provisions of said plan.
(d) Flexible Perquisite Plan. ▇▇▇▇▇▇ shall remain eligible to
participate in the Flexible Perquisite Plan through April 31, 2001, consistent
with the provisions of said plan.
4. Expenses. Pentair shall reimburse ▇▇▇▇▇▇ for all reasonable business
expenses incurred by him in the active performance of his duties as Chairman of
the Board through April 30, 2002, provided ▇▇▇▇▇▇ submits proper documentation
for such expenses.
5. Office Space. Beginning January 1, 2001, Pentair shall provide at no
cost to ▇▇▇▇▇▇ private office space and secretarial services as needed. Said
office space and secretarial services shall be provided until December 31, 2005
or, if earlier, the date of ▇▇▇▇▇▇'▇ death.
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6. Vehicle. Beginning January 1, 2001 Pentair shall, at its expense,
lease an automobile for ▇▇▇▇▇▇'▇ use until December 31, 2010 or, if earlier, the
date of ▇▇▇▇▇▇'▇ death. Pentair shall pay all expenses related to the repair or
maintenance of such vehicle, or shall reimburse ▇▇▇▇▇▇ for such repair or
maintenance expenses as he may incur, provided ▇▇▇▇▇▇ submits proper
documentation for such expenses. Said automobile shall be of a make and model
consistent with the automobile leased by Pentair for use by ▇▇▇▇▇▇ during his
tenure as Chief Executive Officer.
7. Club Membership. Pentair shall, at its expense, provide to ▇▇▇▇▇▇ a
membership in the Minneapolis Club and in a country club selected by ▇▇▇▇▇▇ and
agreed to by Pentair, until December 31, 2010 or, if earlier, the date of
▇▇▇▇▇▇'▇ death.
8. Change in Control. In the event of a change in control of Pentair,
as that term is defined in the Key Executive Employment and Separation Agreement
(the "KEESA"), executed by ▇▇▇▇▇▇ on August 23, 2000, ▇▇▇▇▇▇ shall remain
entitled to receive all compensation and benefits provided to him under this
Agreement, regardless of whether he continues to serve as Chairman of the Board
through the end of the term contemplated by this Agreement. As of April 30,
2001, however, the KEESA signed by ▇▇▇▇▇▇ shall be void and of no further force
and effect.
9. Independent Contractor. From and after May 1, 2001, the date of his
retirement from employment with Pentair, ▇▇▇▇▇▇ shall at all times be an
independent contractor with respect to Pentair. ▇▇▇▇▇▇ understands and agrees
that, as an independent contractor, he is responsible for properly reporting the
monies paid pursuant to this Agreement on his individual federal and state
income tax returns and for paying self-employment taxes on said monies, as
required by applicable law.
10. Confidential Information Acquired During Employment. ▇▇▇▇▇▇ agrees
that he will continue to treat, as private and privileged, any information,
data, figures, projections, estimates, marketing plans, customer lists, lists of
contract workers, tax records, personnel records, accounting procedures,
formulas, contracts, business partners, alliances, ventures and all other
confidential information which ▇▇▇▇▇▇ acquired or created as an employee of
Pentair or any other Group member. ▇▇▇▇▇▇ further agrees that he will not
release any such information to any person, firm, corporation or other entity at
any time, except as may be required by law, or specifically agreed to in writing
by Pentair prior to such disclosure. ▇▇▇▇▇▇ acknowledges that any violation of
this non-disclosure provision shall entitle Pentair to appropriate injunctive
relief and to any damages which it may sustain due to the improper disclosure.
11. Non-Solicitation/Non-Competition Agreement. ▇▇▇▇▇▇ acknowledges
that during employment with the Group, he became familiar with trade secrets,
know-how, executive personnel, business strategies, product development and
other confidential and proprietary information concerning the business of the
Group. In consideration for the compensation and benefits paid to ▇▇▇▇▇▇ under
this Agreement, ▇▇▇▇▇▇ agrees that he shall not at any time, either directly or
indirectly, and without the prior written consent of Pentair:
a. own, manage, control, participate in, consult with or
render services of any kind for any concern which engages in a business
which is
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competitive with any business being conducted, or contemplated being
conducted, by Pentair or any other Group member;
b. become an employee or agent of any publicly traded
corporation or other entity, or any division or subsidiary of such a
corporation or entity, where more than five percent (5%) of such
organization's business is in competition with any business being
conducted, or contemplated being conducted, by Pentair or any other
Group member;
c. participate in any plan or attempt to acquire the business,
assets or control of the voting stock of Pentair or any other Group
member, or in any manner interfere with the control of Pentair or any
other Group member, whether by friendly or unfriendly means;
d. induce or attempt to induce any individual to leave the
employ of Pentair or any other Group member or hire any such individual
who approaches him for employment; or
e. engage in or sponsor the solicitation of customers of
Pentair or any other Group member to do business with any competitor of
Pentair or any member of the Group.
In the event ▇▇▇▇▇▇ breaches or threatens to breach any obligation
under this paragraph 10, Pentair may apply to any court of competent
jurisdiction for specific performance and/or injunctive relief or other relief
to enforce the obligations of ▇▇▇▇▇▇ under this paragraph 10 or to prevent any
violations of said paragraph. Pentair may also pursue any other remedies
available to it on account of a breach or threatened breach of this paragraph
10, including the costs and reasonable attorneys' fees incurred by it in
enforcing its rights under this paragraph 10. In addition to the other remedies
herein provided, Pentair may discontinue all payments or benefits provided to
▇▇▇▇▇▇ under this Agreement.
12. Cooperation. ▇▇▇▇▇▇ agrees that at the request of Pentair, he will,
at any time, cooperate with and assist Pentair (including cooperation and
assistance in any matters involving claims or lawsuits against Pentair or any
other Group member) where ▇▇▇▇▇▇ has or may have knowledge of the facts
involved. ▇▇▇▇▇▇ further agrees that he will not voluntarily aid, assist, or
cooperate with anyone who has claims against Pentair or any other Group member,
or with their attorneys or agents in any claims or lawsuits which such person
may bring against Pentair or any other Group member. Nothing in this Agreement
prevents ▇▇▇▇▇▇ from testifying at an administrative hearing, arbitration,
deposition, or in court, in response to a lawful and properly served subpoena.
13. Merger. This Agreement and the payments and benefits described
herein, together with the Retirement Agreement and Release between ▇▇▇▇▇▇ and
Pentair dated June 26, 2002, supersede and replace all prior oral and written
agreements and understandings between ▇▇▇▇▇▇ and Pentair.
14. Minnesota Law Applies. The terms of this Agreement will be governed
by the substantive laws of the State of Minnesota, without regard to any choice
of laws provisions
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thereof, and it shall be construed and enforced thereunder. All disputes arising
out of or relating to this Agreement shall be subject to the jurisdiction of the
state court sitting in the County of Hennepin, State of Minnesota, and both
parties hereby irrevocably submit to the jurisdiction of such court.
15. Invalidity. If any one or more of the terms of this Agreement are
deemed to be invalid or unenforceable by a court of law, the validity,
enforceability, and legality of the remaining provisions of this Agreement will
not in any way be affected or impaired thereby.
16. Amendment. This Agreement may be modified only by a subsequent
written agreement signed by the parties hereto.
Dated: June 26, 2002 /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Subscribed and sworn to before me
this 26th day of June, 2002.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Notary Public
Dated: June 27, 2002 PENTAIR, INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its Vice President, Human Resources
Subscribed and sworn to before me
this 27th day of June, 2002.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Notary Public
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