PENTAIR INC, DEF 14A, 1994-03-09

PENTAIR INC
DEF 14A, 1994-03-09
GENERAL INDUSTRIAL MACHINERY & EQUIPMENT

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<PAGE>
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934

Filed by the Registrant / /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.142-12

PENTAIR, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

PENTAIR, INC.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):

/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11
1) Title of each class of securities to which transaction applies:

- ------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:

- ------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:*

------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:

- ------------------------------------------------------------------------
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
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<PAGE>
Winslow H. Buxton
Chairman, President
and Chief Executive Officer

March 8, 1994

Dear Shareholder:

Please join us at 10 a.m. on Wednesday, April 20 for Pentair's 27th Annual
Shareholders Meeting at the Northland Inn, Brooklyn Park, Minnesota.

During the meeting, we will elect directors to the Company's board, appoint
auditors and conduct other business as described in the Proxy Statement. In
addition, several Pentair officers will be present to provide a detailed report
on our operations and financial performance, as well as our expectations for
1994. There also will be opportunities for shareholders to ask questions.

We encourage you to join us and participate in the meeting. However, if you
are unable to attend, you can be assured your shares will be represented at the
meeting by completing and returning the enclosed proxy card in the envelope
provided. If you are unsure whether or not you can attend the meeting, please
exercise your right to vote on company business by completing and returning the
proxy card now. Sending your proxy card will not prevent you from voting in
person should you decide to attend the meeting.

I look forward to discussing Pentair's performance with shareholders and
hope you will join us on April 20th.

Sincerely,

Winslow H. Buxton
<PAGE>
PENTAIR, INC.

1500 County Road B2 West
Saint Paul, Minnesota 55113
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 20, 1994

To our Shareholders:

The Annual Meeting of Shareholders of Pentair, Inc. (the "Company") will be
held at the Northland Inn and Conference Center, 7101 Northland Circle, Brooklyn
Park, Minnesota, on Wednesday, April 20, 1994, at 10:00 a.m., for the following
purposes:

1. To elect three directors.

2. To vote upon a proposal to ratify the selection of Deloitte & Touche as
independent auditors of the Company for 1994.

3. To transact such other business as may properly come before the meeting
or any adjournment thereof.

The Board of Directors has fixed the close of business on February 25, 1994
as the record date for determining the shareholders entitled to vote at the
annual meeting. Accordingly, only shareholders of record at the close of
business on that date will be entitled to vote. The Company's transfer books
will not be closed.

By Order of the Board of Directors

R. T. Rueb, Acting Secretary

Saint Paul, Minnesota
March 8, 1994

IMPORTANT: To assure that the annual meeting may be legally held, there must be
a quorum (50% plus 1 vote). Accordingly, you are urged to SIGN AND RETURN THE
ENCLOSED PROXY PROMPTLY. This will not prevent you from voting in person if you
so desire.
<PAGE>
TABLE OF CONTENTS FOR PROXY STATEMENT

<TABLE>
<CAPTION>
Page
-----
<S> <C>
Solicitation............................................................................................... 1
Revocation and Voting of Proxy............................................................................. 1
Outstanding Shares and Voting Rights....................................................................... 2
Security Ownership of Management and Beneficial Ownership.................................................. 2
Proposals to be Acted Upon at the Annual Meeting
Item 1 -- Election of Directors.......................................................................... 5
Item 2 -- Approval of Auditors........................................................................... 10
Executive Compensation..................................................................................... 10
Future Proposals........................................................................................... 18
Other Business............................................................................................. 18
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------

PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 20, 1994
------------------------------------------------------------

PENTAIR, INC.
1500 County Road B2 West
Saint Paul, Minnesota 55113
March 8, 1994

The following statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Pentair, Inc. (the "Company") to be voted
at the annual meeting of shareholders of the Company to be held on Wednesday,
April 20, 1994, or at any adjournment or adjournments of such meeting.
Distribution of this proxy statement and proxy to shareholders began on or about
March 8, 1994.

SOLICITATION

The cost of soliciting proxies and the notices of the meeting, including the
preparation, assembly and mailing of proxies and this statement, will be borne
by the Company. In addition to this mailing, proxies may be solicited personally
or by telephone by regular employees of the Company. Assistance in the
solicitation of proxies is also being rendered by Morrow & Co., 909 Third
Avenue, New York, New York, at a cost to the Company of $7,000 plus expenses.
Furthermore, arrangements may be made with brokers, banks and similar
organizations to send proxies and proxy materials to beneficial owners for
voting instructions, for which the Company will reimburse such organizations for
their expense in so doing and will pay all costs of soliciting the proxies.

REVOCATION AND VOTING OF PROXY

Any shareholder giving a proxy may revoke it prior to its use at the meeting
by (1) delivering a written notice expressly revoking the proxy to the Secretary
at the Company's offices, (2) signing and forwarding to the Company at its
offices a later dated proxy, or (3) attending the annual meeting and casting his
or her votes personally.

A majority of the outstanding shares will constitute a quorum at the Annual
Meeting. Abstentions and broker non-votes are counted for purposes of
determining the presence or absence of a quorum for the transaction of business.
Pursuant to Minnesota law and the Company's Articles of Incorporation,
abstentions are counted in determining the total number of the votes cast on
proposals presented to shareholders, but will not be treated as votes in favor
of the proposals. Broker non-votes are not counted in determining the total
number of votes cast on proposals or for purposes of determining whether a
proposal has been approved.

Unless otherwise directed in the accompanying proxy, the persons named
therein will vote FOR the election of the three director nominees and FOR the
proposal to ratify the appointment of Deloitte & Touche as auditors for 1994. As
to any other business which may properly come before the meeting, they will vote
in accordance with their best judgment, although the Company does not presently
know of any other business.

1
<PAGE>
OUTSTANDING SHARES AND VOTING RIGHTS

At the close of business on February 25, 1994, the record date, there were
outstanding 18,172,891 shares of common stock, par value $.16 2/3 per share, and
1,838,921 shares of 8% Callable Cumulative Voting Convertible Preferred Stock,
Series 1990, par value $.10 per share ("voting preferred"), which are the only
classes of voting stock of the Company entitled to be voted at the meeting.

A shareholder is entitled to one vote for each common and voting preferred
share held on the record date with respect to all matters that may be brought
before the meeting. There is no cumulative voting for directors.

SECTION 16 COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes in ownership of
common stock and other equity securities of the Company. Officers, directors,
and greater than ten-percent shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file.

To the Company's best knowledge, based solely on its review of such reports
and written representations from the Company's officers and directors, no other
Section 16(a) reports were required, during the year ended December 31, 1993.
Therefore, all Section 16(a) filing requirements applicable to its officers and
directors have been satisfied.

SECURITY OWNERSHIP OF MANAGEMENT AND BENEFICIAL OWNERSHIP

The following table contains information as of February 25, 1994 concerning
the beneficial ownership of the Company's voting shares by each director, by
each executive officer, by all directors and executive officers as a group, and
by three persons known to the Company to "beneficially own" more than 5% of
either of its classes of voting shares.

<TABLE>
<CAPTION>
NUMBER OF PERCENT OF NUMBER OF VOTING PERCENT OF COMBINED VOTING
BENEFICIAL OWNER(A) COMMON SHARES(B) CLASS PREFERRED SHARES(B) CLASS PERCENTAGE(C)
<S> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
George N. Butzow 16,259(d) * 0 0 *
Winslow H. Buxton 109,403(e) * 1,054 * *
Joseph R. Collins 22,788(f) * 926 * *
Harold V. Haverty 2,250(g) * 0 0 *
Quentin J. Hietpas 8,413(h) * 0 0 *
B. Kristine Johnson 3,724(i) * 0 0 *
Ronald V. Kelly 71,182(j) * 1,078 * *
Walter Kissling 658(k) * 0 0 *
Gerald C. Kitch 36,940(l) * 1,026 * *
Allan J. Kolles 31,836(m) * 987 * *
H. William Lurton 16,479(n) * 0 0 *
D. Eugene Nugent 412,302(o) 2.3% 850 * 2.1%
All current directors & 788,372(p) 4.3% 8,330 * 4.0%
executive officers as a group
(15 persons)
Charles A. Haggerty 0 0.0% 0 0 0
Brinson Partners, Inc. 1,395,313(q) 7.7% 0 0 7.0%
Three First National Plaza
9th Floor, Suite 111
Chicago, IL 60602-4298
</TABLE>

2
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF NUMBER OF VOTING PERCENT OF COMBINED VOTING
BENEFICIAL OWNER(A) COMMON SHARES(B) CLASS PREFERRED SHARES(B) CLASS PERCENTAGE(C)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
The Prudential Insurance 1,067,740(r) 5.9% 0 0 5.3%
Company of America
Prudential Plaza
Newark, NJ 07102-3777
State Street Bank 374,450(s) 2.1% 1,838,921(s) 100.0% 11.1%
and Trust Company
225 Franklin St.
Boston, MA 02110
<FN>
* Less than 1.0%.
(a) Unless otherwise noted, all shares are held by individuals possessing sole
voting and investment power with respect to such shares. Amounts listed do
not include 528,285 shares held by the Pentair, Inc. Master Trust for
various pension plans of the Company and it subsidiaries, the Investment
Committee of which Master Trust includes Winslow H. Buxton, Joseph R.
Collins, Allan J. Kolles and one other officer. Although these individuals
could be deemed under applicable Securities and Exchange Commission rules
to "beneficially own" all of the shares held by these plans because of
their shared voting and investment power with respect to those shares, they
disclaim beneficial ownership of such shares.
(b) The shares of voting preferred stock are all held by the trustee of the
Company's Employee Stock Ownership Trust. These shares are converted into
common shares upon the retirement or other termination of employment of an
ESOP participant at the ratio of approximately 1.1538 common shares for
each preferred share. The shares of preferred stock vote together with the
common shares as a single class on most issues, with each preferred share
having one vote. The ESOP participants, including those officers listed in
the table, have the right to direct the voting of the shares allocated to
their accounts, although they have no investment power over those shares.
Since the voting preferred shares could be converted into approximately
2,121,745 common shares, under applicable SEC rules the ESOP trustee may be
deemed to beneficially own that number of common shares in addition to the
preferred shares it holds. However, to avoid overstatement of the aggregate
beneficial ownership of the common and voting preferred shares, the common
shares reported in the table do not include the shares that may be acquired
upon conversion of the voting preferred shares, and the calculations of the
percentage of common shares beneficially owned do not take into account any
such shares.
(c) Since the common shares and voting preferred shares vote together as a
single class on all issues being submitted to the shareholders at the
upcoming annual meeting, the percentages below indicate the percentage of
the aggregate voting power represented by the shares of both classes held
by each person listed.
(d) Includes 4,725 shares that could be obtained upon exercise of stock options
within 60 days and 7,691 shares representing Share Units credited to Mr.
Butzow's account in the Third Amended and Restated Compensation Plan for
Non-Employee Directors as to which he currently has no voting or investment
power.
(e) Includes 9,575 restricted shares issued pursuant to an incentive plan as to
which Mr. Buxton has sole voting power but no investment power, 217 shares
held jointly with his spouse as to which he shares voting and investment
power, and 74,850 shares that could be obtained upon exercise of employee
stock options within 60 days.
(f) Includes 2,067 restricted shares issued pursuant to an incentive plan as to
which Mr. Collins has sole voting power but no investment power, 382 shares
held by his spouse as to which he may be deemed to share voting and
investment power, but as to which he disclaims beneficial ownership, and
12,000 shares that could be obtained upon exercise of employee stock
options within 60 days.
</TABLE>

3
<PAGE>
<TABLE>
<S> <C>
(g) Includes 1,500 shares that could be obtained upon exercise of stock options
within 60 days.
(h) Includes 4,725 shares that could be obtained upon exercise of stock options
within 60 days and 841 shares representing Share Units credited to Mr.
Hietpas's account in the Third Amended and Restated Compensation Plan for
Non-Employee Directors as to which he currently has no voting or investment
power.
(i) Includes 1,500 shares that could be obtained upon exercise of stock options
within 60 days and 1,924 shares representing Share Units credited to Ms.
Johnson's account in the Third Amended and Restated Compensation Plan for
Non-Employee Directors as to which she has no voting or investment power.
(j) Includes 4,191 restricted shares issued pursuant to an incentive plan as to
which Mr. Kelly has sole voting power but no investment power, 9,220 shares
held by his spouse as to which he may be deemed to share voting and
investment power, but as to which he disclaims beneficial ownership, and
31,525 shares that could be obtained upon exercise of employee stock
options within 60 days.
(k) Includes 658 shares representing Share Units credited to Mr. Kissling's
account in the Third Amended and Restated Compensation Plan for
Non-Employee Directors as to which he has no voting or investment power.
(l) Includes 4,530 restricted shares issued pursuant to an incentive plan as to
which Mr. Kitch has sole voting power but no investment power, and 20,176
shares that could be obtained upon exercise of employee stock options
within 60 days.
(m) Includes 1,625 restricted shares issued pursuant to an incentive plan as to
which Mr. Kolles has sole voting power but no investment power, 6,120
shares held by his spouse as to which he may be deemed to share voting and
investment power, but as to which he disclaims beneficial ownership, and
5,951 shares that could be obtained upon exercise of employee stock options
within 60 days.
(n) Includes 4,725 shares that could be obtained upon exercise of stock options
within 60 days and 9,119 shares representing Share Units credited to Mr.
Lurton's account in the Third Amended and Restated Compensation Plan for
Non-Employee Directors as to which he currently has no voting or investment
power.
(o) Includes 168,361 shares that Mr. Nugent holds jointly with his spouse as to
which he shares voting and investment power, 22,296 shares held by his
spouse as to which he may be deemed to share voting and investment power,
but as to which he disclaims beneficial ownership, and 68,450 shares that
could be obtained upon exercise of stock options within 60 days.
(p) Includes, with respect to officers not named above, 4,628 shares held by
spouses of officers as to which such officers may be deemed to share voting
and investment power, but as to which they disclaim beneficial ownership;
233 shares held by children of an officer as to which such officer may be
deemed to share voting and investment power, but as to which he disclaims
beneficial ownership; 3,619 shares held jointly by officers and their
spouses as to which such officers share voting and investment power; 4,593
restricted shares issued pursuant to an incentive plan as to which such
officers have sole voting power but no investment power; and 30,912 shares
that could be obtained upon exercise of employee stock options within 60
days.
(q) According to its Schedule 13G dated February 11, 1994, Brinson Partners,
Inc., a registered investment adviser, has sole voting power and sole
investment power over all 1,395,313 shares.
(r) According to its Schedule 13G dated February 7, 1994, Prudential Insurance
Company of America, a registered investment adviser and broker-dealer, has
sole voting and investment power over 548,000 shares and shared voting and
investment power over 519,740 shares.
(s) According to its Schedule 13G dated February 10, 1994, State Street Bank
and Trust Company, as trustee under the Pentair, Inc. Employee Stock
Ownership Trust, may be deemed to have shared voting power and investment
power over all 1,838,921 voting preferred shares, but it has disclaimed
</TABLE>

4
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<TABLE>
<S> <C>
beneficial ownership of all 1,838,921 shares. State Street reports having
sole voting power over 266,850 of the common shares listed, sole investment
power over 372,950 of the common shares listed and shared investment power
of 1,500 of the shares listed, which it holds as trustee for collective
investment funds for other employee benefit plans.
</TABLE>

PROPOSALS TO BE ACTED UPON AT THE ANNUAL MEETING
ITEM 1
ELECTION OF DIRECTORS

The Company's By-Laws provide for a Board of Directors (sometimes referred
to herein as the "Board") of not fewer than three members and not more than
fifteen members. The Board has set the number of directors at nine. The Board is
divided into three classes with all directors serving three-year terms but with
the beginning date for each term staggered so that the term of only one class
expires in any particular year. Vacancies that occur during a term may be filled
by the Board of Directors or by election at a special meeting of shareholders.
Any director elected to fill a vacancy by the remaining directors is required to
stand for election at the next meeting of shareholders.

At the forthcoming annual meeting, three persons are to be elected to the
Company's Board of Directors, two of whom are currently directors of the
Company. From the class of three directors normally scheduled to stand for
election this year, H. William Lurton has indicated that he will retire from the
board effective the date of the annual meeting, and Charles A. Haggerty has been
nominated by the Board to fill the resulting vacancy. Five other directors have
terms of office that do not expire at this time, and each will continue to serve
his or her full term. There is one vacancy for the term ending in 1995 and it
will remain unfilled until the 1995 annual meeting of shareholders. Proxies
cannot be voted for a greater number of directors than the number nominated.
Unless you direct otherwise, proxies will be voted for the election of all
nominees listed below. Should any nominee decline or be unable to accept such
nomination or to serve as director (an event management does not now expect to
occur), proxies will be voted for a substitute nominee or nominees in accordance
with the best judgment of the person or persons acting under them.

If elected, all nominees are expected to serve until the 1997 Annual Meeting
of Shareholders and until their successors are duly elected and qualified.

Information concerning the persons nominated for election as directors, as
well as those continuing in office, is set forth on the following pages.

DIRECTORS STANDING FOR ELECTION
(FOR A THREE-YEAR TERM EXPIRING AT THE 1997 ANNUAL MEETING OF SHAREHOLDERS)

<TABLE>
<S> <C>
[PHOTO] Since 1992, Mr. Haverty has been Chairman of the Board of Directors of
HAROLD V. HAVERTY Deluxe Corporation, a manufacturer of bank checks and internal bank forms.
Director since: 1990 Mr. Haverty has been Chief Executive Officer and President of Deluxe since
1986.
Age: 63
</TABLE>

5
<PAGE>
<TABLE>
<S> <C>
In June 1992, Mr. Haggerty was appointed President and subsequently in
[PHOTO] July 1993 appointed Chairman of the Board of Directors and Chief Executive
Officer of Western Digital Corporation, a manufacturer of hard
CHARLES A. HAGGERTY disk drives and semiconductors. Prior to that, he held various positions
Director since: -- with IBM Corporation including Vice President-General Manager, Worldwide
Age: 52 OEM Storage Marketing (1991-1992); and Vice President-General Manager,
Low-end Storage Products (1989-1990).
Mr. Nugent was the former Chairman of the Board of Directors of
[PHOTO] Pentair, Inc. (since July 1986). Mr. Nugent retired as Chairman of the
Board in January 1993, but will continue as a member of the Board.
D. EUGENE NUGENT Mr. Nugent had been the Chief Executive Officer of the Company from July
Director since: 1975 1986 until August 1992. Mr. Nugent is also a director of Apogee
Age: 66 Enterprises, Inc. and Piper Trust Funds, Inc.
</TABLE>

DIRECTORS CONTINUING IN OFFICE
(TERM EXPIRES AT THE 1995 ANNUAL MEETING OF SHAREHOLDERS)

<TABLE>
<S> <C>
[PHOTO] Since 1983, Mr. Hietpas has been the Senior Vice President of External
Affairs of the University of St. Thomas.
QUENTIN J. HIETPAS
Director since: 1976
Age: 63
Since January 1990, Ms. Johnson has been the Vice President and
[PHOTO] General Manager of the Tachyarrhythmia Management Business of Medtronic,
Inc., a medical devices manufacturer . Prior to that, she held
B. KRISTINE JOHNSON various positions with Medtronic including Vice President, Peripheral
Director since: 1991 Vascular Business (April 1989 through January 1990); and Vice President,
Age: 42 Corporate Affairs and Corporate Planning (March 1987 through April 1989).
Ms. Johnson is also a director of ADC Telecommunications, Inc.
</TABLE>

6
<PAGE>
(TERM EXPIRES AT THE 1996 ANNUAL MEETING OF SHAREHOLDERS)

<TABLE>
<S> <C>
[PHOTO] Since 1982, Mr. Butzow has been the Chairman of the Board of Directors of
GEORGE N. BUTZOW MTS Systems Corporation, a manufacturer of high-technology testing systems.
Mr. Butzow is also a director of Andrew Corporation.
Director since: 1979
Age: 64
Since January 1993, Mr. Buxton has been the Chairman of the Board of
[PHOTO] Directors of Pentair, Inc. Mr. Buxton has been President and Chief
Executive Officer of the Company since August 1992. Mr. Buxton was
WINSLOW H. BUXTON Chief Operating Officer of the Company from August 1990 through August
Director since: 1990 1992. Mr. Buxton was also Vice President - Paper Group of the Company from
Age: 54 January 1989 through August 1990. Mr. Buxton is also a director of Bemis
Company, Inc.
Mr. Kissling has been the President since April 1992 and Chief
[PHOTO] Operating Officer since July 1990 of H. B. Fuller Company, a manufacturer
and marketer of specialty chemical products. He was
WALTER KISSLING Executive Vice President of H.B. Fuller from July 1990 to April 1991, and
Director since: 1993 Senior Vice President from 1980 to 1990. Mr. Kissling is also a director of
Age: 62 H.B. Fuller Company and Chairman and Director of one of its subsidiaries,
Kativo Chemical Industries, S.A.
</TABLE>

DIRECTORS' ATTENDANCE

The Board of Directors held five meetings in 1993. All directors attended at
least 75% of the meetings of the Board and its committees on which they served.

COMMITTEES OF THE BOARD

The Board presently has seven committees.

The Audit Committee, which presently consists of B. Kristine Johnson
(Chair), George N. Butzow, and H. William Lurton, is responsible for selecting
auditors, ensuring the fiscal integrity of the Company, and establishing and
reviewing internal controls. The Audit Committee held two meetings in 1993.

The Compensation and Personnel Committee, which presently consists of
Quentin J. Hietpas (Chair), Harold V. Haverty and D. Eugene Nugent, is
responsible for developing a broad plan of compensation for the Company that is
competitive and rewarding to the degree that it will attract, hold, and inspire
performance of executive, managerial, and other key personnel. The Committee
held ten meetings during 1993.

7
<PAGE>
The Executive Committee, which presently consists of D. Eugene Nugent
(Chair), Winslow H. Buxton, and Quentin J. Hietpas, makes and implements
decisions that require immediate or rapid action when it is impractical to call
a meeting of the full Board of Directors. The Committee held one meeting in
1993.

The Nominating Committee, which presently consists of D. Eugene Nugent
(Chair), Winslow H. Buxton, and Harold V. Haverty, is responsible for nominating
candidates for vacancies on the Board. The Nominating Committee will consider
nominees recommended by shareholders under procedures set forth in the Company's
By-Laws. Sections 9 through 12 of Article II of the By-Laws provide that a
candidate may not be nominated for election as a director at the annual meeting
of shareholders unless the nomination was previously submitted to the Board or
its Nominating Committee. A shareholder wishing to nominate a candidate for
director must do so no later than sixty days following the end of the Company's
fiscal year. Nominations are deemed made when the Secretary of the Company
receives all of the following: (1) all information about the nominee that may be
required to be provided in any proxy statement pursuant to the Securities
Exchange Act of 1934 and regulations promulgated thereunder; (2) an executed
directors' questionnaire provided by the Company and completed by the nominee;
(3) the nominee's statement consenting to his or her nomination and agreeing to
serve, if elected; and (4) evidence that the person making the nomination is a
shareholder. After reviewing the submission, the Board or the appointed
Nominating Committee may, but need not, designate one or more of the nominees to
appear as an alternate candidate on any proxy solicited by management or any
proxy statement furnished by management. The number of such alternate candidates
may not exceed the number of directors to be elected at that annual meeting.
Exclusion of any eligible candidate from a proxy solicited by management does
not affect the right of shareholders to nominate, vote for, or elect such
candidate at any shareholders meeting held within twelve months after submission
of the nomination material described above. The Nominating Committee held one
meeting in 1993.

The Public Policy Committee, formed in July 1992, which presently consists
of Harold V. Haverty (Chair), and B. Kristine Johnson, is responsible for
overseeing the Company's interest in the legislative, regulatory, philanthropic
and public areas, and for making recommendations regarding the Company's role as
a responsible corporate citizen. The Committee held one meeting in 1993.

The Shareholder Affairs Committee, which presently consists of George N.
Butzow (Chair), Winslow H. Buxton, B. Kristine Johnson, and Walter Kissling, is
responsible for reviewing any proposed transaction involving the Company's
securities that could significantly alter the Company's shareholder base,
operations, or overall management. It has the power to engage advisers, direct
management to issue statements on behalf of the Company, institute legal action
deemed to be in the best interests of the Company, and take other appropriate
action. The Committee did not meet in 1993.

The Share Rights Committee, which presently consists of H. William Lurton
(Chair), and Walter Kissling, is responsible for making recommendations to the
Board regarding the Company's Rights Agreement. The Committee did not meet in
1993.

DIRECTORS' REMUNERATION

Each director who is not an employee of the Company will be paid in 1994,
$20,000 ($21,000 if Chair of a Board Committee) as an annual retainer, $1,000
for each attendance at a Board meeting, $1,000 for each attendance at a
committee meeting, and $300 for participation in a telephone conference in lieu
of a meeting.

Under the Third Amended and Restated Compensation Plan for Non-Employee
Directors, directors who are not employees of the Company may elect to defer
payment of all or a portion of their director's fees. The amounts deferred can
be either set aside in a cash account or used to purchase shares of the

8
<PAGE>
Company's common stock. The plan provides for a Company match of 25% on the
first $750 per month deferred in the form of common stock. Participants and
amounts deferred under the Plan are shown below:

<TABLE>
<CAPTION>
$ DEFERRED $ DEFERRED $ DEFERRED SHARE UNITS
1991 1992 1993 12/31/93
- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
Butzow $ 21,075 $ 25,750 $ 26,200 7,545
Hietpas 0 0 9,000 816
Johnson 0 23,450 25,850 1,698
Kissling 0 0 17,700 467
Lurton 24,700 25,750 29,500 8,899
</TABLE>

The plan also provides that former non-employee directors who meet certain
requirements are to be considered for retirement benefits to extend for a term
equal to the number of years served as a non-employee director or until death,
whichever occurs first, which benefits shall be paid monthly in an amount equal
to the pro rata monthly retainer fee being paid to the director at the time of
termination from the Board. The Company is currently paying compensation
benefits to three former directors. Finally, in the event of an unfriendly
change in control of the Company, the plan provides for the establishment of
depository agreements and the payment into trust of funds sufficient to ensure
the payment of any deferred director's fees or retirement benefits due former
directors.

The Outside Directors Nonqualified Stock Option Plan provides for the
granting of options to purchase the Company's common stock to directors who are
not employees of the Company. The plan was amended effective January 12, 1992 to
provide for automatic annual grants to the directors and to offer alternative
forms of payment of the exercise price including surrender of Pentair common
stock or unexercised options. The persons to receive options, the number of
options granted, and the terms of the options are determined by the Plan. No
option granted under the plan, however, may extend for a period of more than ten
years from the date of the grant and no option exercise price may be less than
the current market price of Pentair common stock on the date of award of such
option.

<TABLE>
<CAPTION>
OPTIONS EXERCISE OR
NAME YEAR GRANTED BASE PRICE EXPIRATION DATE
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
George N. Butzow 1993 1,500 $ 28.6667 1/19/98
1992 1,500 $ 29.4167 1/14/97
1991 1,725 $ 16.3333 1/10/96
Harold V. Haverty 1993 1,500 $ 28.6667 1/19/98
1992 1,500 $ 29.4167 1/14/97
Quentin J. Hietpas 1993 1,500 $ 28.6667 1/19/98
1992 1,500 $ 29.4167 1/14/97
1991 1,725 $ 16.3333 1/10/96
B. Kristine Johnson 1993 1,500 $ 28.6667 1/19/98
1992 1,500 $ 29.4167 1/14/97
H. William Lurton 1993 1,500 $ 28.6667 1/19/98
1992 1,500 $ 29.4167 1/14/97
1991 1,725 $ 16.3333 1/10/96
D. Eugene Nugent 1993 1,500 $ 28.6667 1/19/98
</TABLE>

One-third of the options granted to each recipient become exercisable on
each of the first three anniversaries of the date of grant, and the options
expire five years after the date of grant. Three current directors exercised
options during 1991-1993; the net value of shares (market value less exercise
price) realized from this exercise was $82,715.

9
<PAGE>
ITEM 2
APPROVAL OF AUDITORS

Deloitte & Touche, independent certified public accountants have been the
auditors for the Company since 1977. They have been retained by the Board of
Directors as the Company's auditors for the current fiscal year, and shareholder
approval of such retention is requested.

Representatives of Deloitte & Touche are expected to attend the Annual
Meeting with the opportunity to make a statement if they so desire, and they
will be available to respond to appropriate questions.

The Board of Directors recommends that the shareholders vote "For" the
proposal to approve retention of Deloitte & Touche, and the enclosed proxy will
be so voted unless a contrary vote or abstention is indicated. If retention of
Deloitte & Touche is not approved by the shareholders, the Board of Directors
will make another appointment effective at the earliest practicable date.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
RETENTION OF DELOITTE & TOUCHE.

EXECUTIVE COMPENSATION

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Compensation and Personnel Committee of the Board of Directors was
comprised of Quentin J. Hietpas (Chair), Harold V. Haverty and D. Eugene Nugent
during 1993. None of the members of the Committee were officers or employees of
the Company during 1993, but D. Eugene Nugent is the former Chairman of the
Board and Chief Executive Officer of Pentair, Inc. There are no additional
insider or interlock relationships.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION.

OVERVIEW

The Compensation and Personnel Committee of the Board of Directors (the
"Committee") is responsible for supervising the development of and making
recommendations to the Board with respect to the Company's executive
compensation policies. In addition, the Committee makes annual recommendations
to the Board concerning compensation to be paid to the Chief Executive Officer
and each of the other executive officers of the Company.

The Committee also oversees all aspects of the Company's executive
compensation program, including many of the Company's employee benefit plans.
The Company currently maintains a variety of compensation and benefit plans in
which its executive officers may participate, including the Omnibus Stock Plan,
the Employee Stock Purchase and Bonus Plan, the Retirement Savings and Stock
Incentive Plan, the Deferred Compensation Plan, the Supplemental Executive
Retirement Plan, and the Management Incentive Plan. The Company also maintains a
defined benefit pension plan in which substantially all non-bargaining
employees, including the executive officers, participate.

PENTAIR'S COMPENSATION PHILOSOPHY

The principles guiding the executive compensation program are designed to
ensure a proper linkage between executive compensation and creation of
shareholder value. Goals of the program are:

(a) to encourage continuation of Pentair's entrepreneurial spirit,

(b) to reward executives for successful long-term strategic management,

10
<PAGE>
(d) to attract and retain highly qualified and motivated executives, and

(e) to encourage executive stock ownership to enhance a mutuality of
interest with other shareholders.

The Company has maintained the philosophy that compensation of the executive
officers should be directly and materially linked to operating and stock
performance. To achieve this, compensation is heavily leveraged through annual
bonuses and equity incentives. The mix of base salary, bonuses and other
benefits reflects the Company's goals of providing average compensation for
average performance and above average compensation for above average
performance.

In order to make its recommendations to the Board concerning executive
officer compensation, the Committee annually reviews and evaluates the Company's
corporate performance and the compensation and equity ownership of its executive
officers as compared with similarly sized industrial companies included in the
Towers Perrin Compensation database and the database of another nationally
recognized management consulting service. The Committee has retained Towers
Perrin, an independent compensation consulting firm, to assist it in this
review.

EXECUTIVE COMPENSATION PROGRAM

The components of the Company's executive compensation program which are
subject to the discretion of the Committee on an individual basis include (a)
base salaries, (b) annual cash performance-based bonuses, (c) long-term equity
incentives, and (d) miscellaneous other fringe benefits. All components are
comparable to those of similar companies.

BASE SALARY

In line with the Company's current policy with respect to the base salaries
of its executive officers, the CEO recommends to the Committee with respect to
annual salaries of the Company's executive officers. The Committee then
discusses and approves the salaries and makes its recommendation to the Board.
Base salary targets for executive positions are set at the 50th percentile of
competitive compensation. An individual performance and experience factor is
applied to the target midpoint to determine each executive's actual base salary,
within a range of A20% of midpoint. A competent employee should attain midpoint
salary within 3 years by demonstrating continuing development and performance
consistent with his or her capabilities in the position.

For 1993, the salaries of the named executive officers identified in the
Summary Compensation Table were within the salary targets for each position.

ANNUAL CASH BONUS

Pentair expects to compensate its employees for achievement of company and
individual performance goals. Strategic performance goals are established during
the budgeting process in October of the preceding year and are based on economic
factors and targeted performance objectives. Pentair's profit plan is deemed to
be the best judge of how the Company should perform in current market and
economic conditions. Incentive bonus awards are determined by a formula
containing four factors: base salary, bonus opportunity category percentage
(BOC), company performance factor and individual performance factor. BOC
categories are assigned to each position at Pentair. The company performance
factor is based on the percentage of corporate goals for pre-tax income achieved
during the fiscal year. Below a certain threshold, no award of bonus
compensation is made, other than for officers who have individually performed
beyond expectations and then at a reduced rate. If performance is above that
threshold, but below plan, the bonus factor is leveraged downward by double the
percentage shortfall from plan. Conversely, if performance is above plan, the
bonus factor is similarly leveraged upward. The individual performance factor is
determined by the assignment of a numerical factor based on a supervisor's
judgment on attainment of expectations relative to the employee's function. The
CEO submits a written performance appraisal and recommendation to the Committee
for each executive officer with respect to the individual performance factor. A
supplemental incentive award may also be

11
<PAGE>
granted at the discretion of the Committee to any person who has made an
extraordinary contribution to the Company's welfare or earnings. The maximum
annual bonus may not exceed 100 percent of an individual's base salary.

In 1993, bonuses were awarded based on the foregoing factors with the
exception of a supplemental award given to J.R. Collins in recognition of his
assumption of the additional responsibilities of Acting Chief Financial Officer
undertaken in connection with the retirement of the Company's former Chief
Financial Officer.

LONG-TERM EQUITY INCENTIVES

GRANTS

Long-term incentive compensation may be awarded in the form of restricted
shares, incentive compensation performance units (ICUs) and stock options. All
awards are reviewed by the CEO and approved by the Compensation Committee.
Long-term incentives are determined by using the average of the 50th and 60th
percentile of comparable grant practices as compiled in the Towers Perrin
Compensation database. The awards are given to named executive officers in
ratios of 0% restricted stock, 30% ICUs and 70% stock options. The Black-Scholes
Model is used to determine restricted stock and stock option grants. A
comparable model is used for determining ICU grant values.

The total awards for 1993 amounted to no shares of restricted stock, 61,450
incentive compensation units (ICUs) and 104,625 stock options for all executive
officers of the Company as a group. All grants were made in accordance with the
formula discussed above. Grants for the named executive officers are shown in
the Summary Compensation Table and the Option/SAR Grant Table.

PAYOUTS

Payouts on ICUs are based upon growth in the Company's net book value over
the life of the ICUs, as leveraged upward or downward depending on whether the
Company's return on equity and growth in earnings per share over that period
exceeded or fell short of corporate goals. Restricted share value is the market
value of common stock on the date the shares become vested.

Payouts in 1993, for named executive officers, as shown in the LTIP Payout
column on the Summary Compensation Table (page 15), were for previously awarded
ICU grants and were calculated based on the increase in book value and the
percentage attainment of EPS and ROE goals since the date of such grants. Also
included is the market value of previously awarded restricted shares that vested
in 1993.

COMPENSATION OF THE CHIEF EXECUTIVE OFFICER

The base salary, annual bonus and long-term equity incentives are similar to
and comprised of the same elements as for all executive officers.

In 1993, Mr. Buxton led the Company to excellent performance in the face of
difficult economic conditions. He also assumed the additional duties of Chairman
of the Board of Directors in January 1993.

The Committee's evaluation of his individual performance factor was very
high because he exceeded individual performance goals set by the Compensation
Committee. He also succeeded in stepping into his leadership role as new CEO and
continued to strengthen the Company's management team.

The base salary market compensation rate for a CEO position at the 50th
percentile was $530,000 in 1993. Mr. Buxton's base salary was increased to
$425,000 in accordance with the Committee's policy of a 3 year progression
toward market compensation. This resulted in a 19.4% increase in Mr. Buxton's
base salary over 1992.

Mr. Buxton's bonus was calculated using the formula described above. The
Committee used his base salary of $425,000, his BOC rate of 55% and applied the
corporate performance factor for 1993 and Mr. Buxton's individual performance
factor to obtain his bonus amount of $343,379.

12
<PAGE>
Mr. Buxton's long-term incentive grants were computed based on the average
of the 50th and 60th percentile of the Towers Perrin Compensation database for
comparable grant practices. He was granted 25,300 ICUs and 38,250 stock options
in 1993.

Based on the foregoing, Mr. Buxton's compensation for 1993 was determined in
accordance with the criteria described above for executive compensation and is
set forth in the Summary Compensation Table.

STOCK OWNERSHIP GUIDELINES

In January 1993, voluntary stock ownership guidelines were developed. Stock
ownership guidelines for top management were established to motivate acquisition
and retention of shares of Pentair common stock. The Committee determined that
over a period of five years, its top management should accumulate and hold
Company stock equal to the following values: Chief Executive Officer --three to
five times base salary; Senior Corporate Officer -- two to three times base
salary; and other corporate officers and subsidiary presidents -- one to two
times base salary. In the opinion of the Committee, the achievement of ownership
levels set forth will result in executive management being significant
shareholders and will further encourage long-term performance and Company
growth.

COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M)

Section 162(m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to public companies for compensation over $1 million
paid to the corporation's Chief Executive Officer and four other most highly
compensated officers. Qualifying performance-based compensation will not be
subject to the deduction limit if certain requirements are met. The Company
currently intends to review its compensation systems and structure
performance-based compensation in a manner that complies with the new statute.
In 1994, the Company expects all compensation paid to the Chief Executive
Officer and the four other highly compensated officers will be 100% tax
deductible.

J. H. GRUNEWALD RETIREMENT.

J. H. Grunewald entered into a Retirement Agreement with the Company under
which the Company would pay him certain amounts upon retirement in June 1993.
Based on Mr. Grunewald's years of performance and significant contributions to
the Company, the Committee unanimously voted to vest all of his options and
award Mr. Grunewald 24 months' salary. In addition, certain long-term incentive
benefits were accelerated upon Mr. Grunewald's retirement. Restricted stock
(5,402 shares) and ICUs (27,675 units) were released or paid early when the
Committee exercised its discretion in accelerating the expiration of the
restriction and incentive periods. The amounts paid to Mr. Grunewald in 1993
relative to the acceleration are included in the LTIP Payout column of the
Summary Compensation Table on page 15.

Quentin J. Hietpas, Chair Harold V. Haverty D. Eugene Nugent

Compensation and Personnel Committee of Pentair, Inc.

13
<PAGE>
COMPARATIVE STOCK PERFORMANCE GRAPH

The graph on the following page sets forth the cumulative total shareholder
return on the Company's Common Stock for the last five fiscal years, assuming
the investment of $100 on December 31, 1988 and the reinvestment of all
dividends since that date to December 31, 1993. The graph also contains for
comparison purposes the S&P 500 Index and the NASDAQ Non-Financial Index. The
data used was obtained from published sources and is believed to be accurate.

[GRAPHIC]

14
<PAGE>
SUMMARY COMPENSATION TABLE.

The following table sets forth the cash and noncash compensation for each of
the last three fiscal years awarded to or earned by the Chief Executive Officer
of the Company and the four highest paid executive officers of the Company whose
salary and bonus earned in 1993 exceeded $100,000.

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-------------------------------------

AWARDS
ANNUAL COMPENSATION ------------------------ PAYOUTS
--------------------------------------- RESTRICTED SECURITIES -----------
OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS (A) COMPENSATION AWARDS (B) OPTIONS PAYOUTS COMPENSATION
POSTION YEAR ($) ($) ($) ($) /SARS ($)(D) ($)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Winslow H. Buxton 1993 $ 425,000 $ 343,379 $ 9,699 $ 0 38,250 $ 56,820 $ 0
Chief Executive 1992 343,750 184,202 10,908 92,663 49,650 19,868 0
Officer 1991 277,200 240,489 5,617 78,400 27,000 14,430 0
Gerald C. Kitch 1993 $ 227,000 $ 133,031 $ 6,886 $ 0 11,625 $ 26,576 $ 0
Senior Vice 1992 218,000 109,036 7,579 41,919 8,850 10,034 0
President 1991 205,000 162,248 9,444 33,075 11,250 0 0
Joseph R. Collins 1993 $ 210,000 $ 138,045 $ 7,290 $ 0 11,625 $ 23,233 $ 0
Senior Vice 1992 185,000 102,742 6,557 41,919 10,350 23,890 0
President 1991 156,220 136,828 7,650 10,780 3,675 21,628 0
Ronald V. Kelly 1993 $ 227,000 $ 122,807 $ 7,098 $ 0 11,625 $ 26,576 $ 0
Senior Vice 1992 218,000 85,512 7,122 41,919 8,850 10,034 0
President 1991 205,000 179,144 7,784 33,075 11,250 0 0
Allan J. Kolles 1993 $ 170,000 $ 87,406 $ 7,721 $ 0 6,150 $ 29,168 $ 0
Vice President 1992 160,000 66,685 7,561 19,856 4,200 28,208 0
Human Resources 1991 147,175 94,825 8,848 15,925 5,475 22,746 0
John H. Grunewald 1993 $ 107,083 $ 128,500 $ 11,758 $ 0 11,625 $ 161,147(c) $ 594,000(c)
Retired Executive 1992 243,000 115,746 7,218 41,919 9,000 41,241 0
Vice President; CFO 1991 234,200 196,833 7,056 34,300 11,775 35,330 0
<FN>
- ------------------------------
(a) Represents bonuses accrued by the Company for the year even if paid after
December 31.
(b) The restricted stock awards shown in this column are subject to vesting,
in three equal installments beginning in the third year after the date of
grant, based solely on the continued employment of the recipient by the
Company. Dividends are accrued and paid upon vesting of restricted shares.
The following restricted stock awards were held by each of the named
executives as of December 31, 1993 (based on 12/31/93 closing price of
$33.00): Buxton 11,649 shares or $384,417; Collins 2,783 shares or
$91,839; Kelly 5,249 shares or $173,217; Kitch 5,249 shares or $173,217;
Kolles 2,632 shares or $86,856; and Grunewald 0 shares or $0.
(c) Amounts paid in 1993, see discussion of J.H. Grunewald Retirement
Agreement on page 13.
(d) Includes payouts for ICUs and market values of restricted stock that
vested in 1993.
</TABLE>

15
<PAGE>
OPTIONS AND STOCK APPRECIATION RIGHTS.

The following tables summarize option and SAR grants and exercises during
1993 to or by the Chief Executive Officer or one of the executive officers named
in the Summary Compensation Table above, and the values of the options and SARs
held by such persons at the end of 1993. No SARs have been granted since 1983;
all grants shown in the table below are incentive stock options. No SARs have
been exercised or remain outstanding at the end of 1993.

POTENTIAL REALIZABLE
OPTION AND SAR GRANTS IN 1993 VALUE AT ASSUMED
-------------------------------------------------------------------- ANNUAL RATES OF
NUMBER OF STOCK PRICE
SECURITIES APPRECIATION FOR
UNDERLYING % OF TOTAL OPTIONS/ SARS OPTION TERM
OPTIONS/ SARS GRANTED TO EMPLOYEES IN EXERCISE OR EXPIRATION --------------------
NAME GRANTED (A) FISCAL 1993 BASE PRICE DATE 5% 10%
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Winslow H. Buxton 38,250 20.6% $ 27.00 1/08/98 $ 285,330 $ 630,504
Joseph R. Collins 11,625 6.3% $ 27.00 1/08/98 $ 86,718 $ 191,624
Ronald V. Kelly 11,625 6.3% $ 27.00 1/08/98 $ 86,718 $ 191,624
Gerald C. Kitch 11,625 6.3% $ 27.00 1/08/98 $ 86,718 $ 191,624
Allan J. Kolles 6,150 3.3% $ 27.00 1/08/98 $ 45,877 $ 101,375
John H. Grunewald 11,625 6.3% $ 27.00 1/08/98 $ N/A(b) $ N/A(b)
<FN>
- ------------------------------
(a) One-third of each grant becomes exercisable on each of the first three
anniversaries of the date of grant, and the options expire five years
after the grant date. The exercise price for the options granted was the
market price of the common stock as of the date of grant.
(b) All exercised prior to 12/31/93, see discussion of J.H. Grunewald
Retirement on page 13.
</TABLE>

<TABLE>
<CAPTION>
AGGREGATE OPTION AND SAR EXERCISES IN 1993 AND VALUE AT END OF 1993
- ----------------------------------------------------------------------------------------------
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
END OF 1993 END OF 1993
SHARES ACQUIRED VALUE EXERCISABLE (E) EXERCISABLE (E)
NAME ON EXERCISE REALIZED UNEXERCISABLE (U) UNEXERCISABLE (U)
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Winslow H. Buxton 11,800 $ 230,983 E 46,500 E $578,554
U 80,350 U $563,108
Joseph R. Collins 2,376 $ 33,570 E 3,450 E $ 12,363
U 19,750 U $114,892
Ronald V. Kelly 1,500 $ 12,750 E 20,950 E $280,821
U 21,275 U $153,392
Gerald C. Kitch 4,350 $ 55,244 E 9,601 E $106,251
U 21,275 U $153,392
Allan J. Kolles 9,087 $ 191,010 E 676 E $ 2,422
U 10,775 U $ 77,350
John H. Grunewald 31,976 $ 414,105 E 0 E $ 0
U 0 U $ 0
</TABLE>

16
<PAGE>
LONG-TERM INCENTIVE PLAN AWARDS.

The following table reflects awards made under the Pentair, Inc. Omnibus
Stock Incentive Plan (one of the long-term incentive plans) during 1993 to the
Chief Executive Officer or one of the executive officers named in the Summary
Compensation Table above.

<TABLE>
<CAPTION>
PERFORMANCE OR ESTIMATED FUTURE PAYOUTS UNDER
NUMBER OF SHARES, OTHER PERIOD NON-STOCK PRICE BASED PLANS
UNITS OR OTHER UNTIL MATURATION -------------------------------------
NAME RIGHTS OR PAYOUT THRESHOLD TARGET MAXIMUM
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Winslow H. Buxton 25,300 units (a) $ 0 $ 272,026 $ 340,032
Joseph R. Collins 7,650 units (a) $ 0 $ 82,253 $ 102,816
Ronald V. Kelly 7,650 units (a) $ 0 $ 82,253 $ 102,816
Gerald C. Kitch 7,650 units (a) $ 0 $ 82,253 $ 102,816
Allan J. Kolles 4,050 units (a) $ 0 $ 43,546 $ 54,432
John H. Grunewald 7,650 units (a),(b) N/A N/A N/A
<FN>
- ------------------------
(a) Matures in 3-5 yrs., payout based on ROE, EPS, and Book Value growth over
the three, four or five year periods.
(b) Paid out $13,005 in June 1993 upon retirement from the Company. See
discussion of J.H. Grunewald Retirement on page 13.
</TABLE>

DEFINED BENEFIT PENSION PLAN.

The Company maintains a tax-qualified defined benefit pension plan. In
general, the plan covers non-bargaining employees of the Company and its U.S.
subsidiaries. These employees are eligible to participate in the plan after
attaining age 21 and completing one year of service.

The following table sets forth the estimated normal retirement benefit under
specified final average annual compensation and years of service
classifications. Each listed benefit amount is determined by using a Social
Security covered compensation base of $24,600. The annual benefit limit of
$118,800 reflected in the table represents the maximum retirement benefit
payable in 1994 under tax-qualified defined benefit plans, although this limit
is subject to upward adjustment in future years for cost-of-living increases.

ESTIMATED ANNUAL GROSS RETIREMENT BENEFITS UNDER CURRENT FORMULA

<TABLE>
<CAPTION>
FINAL AVERAGE
ANNUAL YEARS OF SERVICE
COMPENSATION 10 15 20 25 30 35+
- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 50,000 $ 6,360 $ 9,540 $ 12,720 $ 15,900 $ 19,080 $ 22,260
100,000 13,860 20,790 27,720 34,650 41,580 48,510
150,000 21,360 32,040 42,720 53,400 64,080 74,760
200,000 28,860 43,290 57,720 72,150 86,580 101,010
235,840+ 34,236 51,354 68,472 85,590 102,708 115,641
</TABLE>

For purposes of calculating the retirement benefit for named executive
officers under the plan, eligible compensation consists of salary and bonus as
listed in the Summary Compensation Table. Current years of service under the
plan for the named officers are: Buxton, 7; Collins, 22; Kelly, 13; Kitch, 5 and
Kolles, 9.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN.

The Company has established the Supplemental Executive Retirement Plan to
provide retirement benefits to certain key executives of the Company and its
subsidiaries. The employees are eligible for nomination after attaining age 50
and completing five years of service. The annual normal retirement benefit is
50% of the participant's final average annual compensation less 100% of the
participant's annual primary Social Security benefit. This benefit is further
reduced by the participants benefits under the Company's or any previous
employers pension plans. A participant generally does not earn or

17
<PAGE>
become vested in a benefit under the plan until he or she attains age 60. The
plan has been extended to eight individuals, four of whom (Buxton, Collins,
Kelly and Kolles) are named executives. To date, two of these individuals have
become vested in benefits under the plan. One is a named executive (Kolles,
$590,187 vested benefit). The remaining six have not earned or become vested in
a benefit because they have not attained age 60. To date, two retirees and one
beneficiary are receiving benefits under the plan.

CHANGE IN CONTROL ARRANGEMENTS.

Approximately 86 key corporate executives have entered into agreements with
the Company that provide for contingent benefits if the executive leaves the
employ of the Company within one year after an unfriendly change in control.
Such benefits include:

a. bonus awards for the year in question to be made under the Management
Incentive Plan;

b. termination of all restrictions on shares issued under the Long-Term
Executive Performance Plan or the 1990 Omnibus Stock Incentive Plan and
payment for Incentive Compensation Units and Performance Units without
regard to the plans' forfeiture provisions;

c. reimbursement of income taxes incurred in connection with the exercise
of certain nonqualified options, as well as termination of all
restrictions on transfer and termination of any right of the Company to
repurchase shares received upon exercise of such options;

d. the cost of an executive search agency;

e. directors and officers liability insurance coverage;

f. short-term replacement coverage for Company-provided group medical,
dental, and life insurance policies;

g. amount of non-vested benefits under any of the Company's tax-qualified
deferred compensation plans;

h. the accelerated accrual and vesting of benefits under the Supplemental
Executive Retirement Plan (for those executives who have been made
participants of such plan); and

i. severance pay equal to 300% of annual compensation or, for employees
other than executive officers of the Company, such amount reduced to the
extent necessary to avoid federal excise taxes under Section 280G of the
Internal Revenue Code.

In addition, the Omnibus Stock Incentive Plan permits the Compensation and
Personnel Committee upon a change in control of the Company to cancel all
outstanding options granted under the plan, whether or not exercisable, and
authorize payment of the "spread" between the exercise price of the options and
the then current market value of the stock.

Based upon compensation levels as of December 31, 1993, the dollar value of
the benefits payable upon an unfriendly change in control to the named officers
in the Summary Compensation Table by virtue of the agreements and the Omnibus
Plan provision discussed above (excluding amounts that otherwise would be
payable upon a termination of employment not involving an unfriendly change in
control) would be: Buxton, $3,392,153; Collins, $1,512,019; Kelly, $2,032,234;
Kitch, $2,024,108 and Kolles, $1,209,530.

FUTURE PROPOSALS

Any proposal that a shareholder intends to present at the 1995 annual
meeting must be received by the Company no later than November 4, 1994 for
inclusion in the 1995 notice of annual meeting, proxy statement, and form of
proxy.

OTHER BUSINESS

Management does not know of any other business that will be presented for
consideration at the meeting; however, if any other business does properly come
before the meeting, proxies will be voted in accordance with the best judgment
of the person or persons acting under them.

18
<PAGE>

<TABLE>
<S> <C> <C>
PLEASE SIGN AND PENTAIR, INC. -- COMMON PENTAIR INC.
RETURN PROMPTLY TO PROXY FOR ANNUAL MEETING OF
REDUCE SOLICITATION EXPENSES SHAREHOLDERS
APRIL 20, 1994
</TABLE>

The undersigned hereby appoints Winslow H. Buxton and Joseph R. Collins, or
either of them, as Proxies, each with the power to appoint his substitute, and
hereby authorizes them to represent and to vote, as designated below, all the
shares of common stock of Pentair, Inc. held of record by the undersigned on
February 25, 1994 at the Annual Meeting of Shareholders of Pentair, Inc. to be
held at 10:00 a.m., Wednesday, April 20, 1994, at the Northland Inn and
Conference Center, 7101 Northland Circle, Brooklyn Park, Minnesota, and any
adjournment thereof.

THE BOARD RECOMMENDS A VOTE "FOR" EACH PROPOSAL.

<TABLE>
<S> <C>
1. ELECTION OF DIRECTORS: FOR all nominees listed below / / WITHHOLD AUTHORITY to vote for all nominees listed below. / /
EXCEPT THOSE I HAVE STRUCK BY A LINE THROUGH
their names.
</TABLE>

Charles A. Haggerty Harold V. Haverty D. Eugene Nugent

2. PROPOSAL TO RATIFY the retention of Deloitte & Touche as independent
public accountants for the current fiscal year.

/ / FOR / / AGAINST / / ABSTAIN
<PAGE>
3. In their discretion, the Proxies are authorized to vote upon such other
matters as may properly come before the meeting. Management is not
presently aware of any such matters to be presented for action.

THE SHARES REPRESENTED HEREBY WILL BE VOTED AS DIRECTED BY THIS PROXY, BUT
IF THIS PROXY IS RETURNED WITH NO DIRECTION MADE, THEY WILL BE VOTED "FOR" EACH
OF THE DIRECTORS AND PROPOSALS.

The undersigned hereby ratifies and
confirms all that the Proxies shall
lawfully do or cause to be done by
virtue hereof and hereby revokes
all proxies heretofore given to
vote such shares.

THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS OF
PENTAIR, INC.
___________________________________
Signature
___________________________________
Signature if held jointly
Dated: ______________________, 1994
THIS CARD MUST BE DATED.
(Please sign exactly as your name
appears to the left. When shares
are held by joint tenants, both
should sign. When signing as
executor, administrator, attorney,
trustee or guardian, please give
full title as such. If a
corporation, please sign in full
corporate name by president or
other authorized officer. If a
partnership, please sign in
partnership name by an authorized
person.)
<PAGE>

<TABLE>
<S> <C> <C>
PLEASE SIGN AND PENTAIR, INC. -- PREFERRED PENTAIR, INC.
RETURN PROMPTLY TO PROXY FOR ANNUAL MEETING OF
REDUCE SOLICITATION EXPENSES SHAREHOLDERS
APRIL 20, 1994
</TABLE>

The undersigned hereby appoints Winslow H. Buxton and Joseph R. Collins, or
either of them, as Proxies, each with the power to appoint his substitute, and
hereby authorizes them to represent and to vote, as designated below, all the
shares of preferred stock of Pentair, Inc. held of record by the undersigned on
February 25, 1994 at the Annual Meeting of Shareholders of Pentair, Inc. to be
held at 10:00 a.m., Wednesday, April 20, 1994, at the Northland Inn and
Conference Center, 7101 Northland Circle, Brooklyn Park, Minnesota, and any
adjournment thereof.

THE BOARD RECOMMENDS A VOTE "FOR" EACH PROPOSAL.

<TABLE>
<S> <C>
1. ELECTION OF DIRECTORS: FOR all nominees listed below / / WITHHOLD AUTHORITY to vote for ALL nominees listed below. / /
EXCEPT THOSE I HAVE STRUCK BY A LINE THROUGH
their names.
</TABLE>

Charles A. Haggerty Harold V. Haverty D. Eugene Nugent

2. PROPOSAL TO RATIFY the retention of Deloitte & Touche as independent
public accountants for the current fiscal year.

THE SHARES REPRESENTED HEREBY WILL BE VOTED AS DIRECTED BY THIS PROXY, BUT
IF THIS PROXY IS RETURNED WITH NO DIRECTION MADE, THEY WILL BE VOTED "FOR" EACH
OF THE DIRECTORS AND PROPOSALS.

The undersigned hereby ratifies and
confirms all that the Proxies shall
lawfully do or cause to be done by
virtue hereof and hereby revokes
all proxies heretofore given to
vote such shares.

I hereby direct State Street Bank and Trust Company, as ESOP Trustee, to
vote at the Annual Meeting of Shareholders of Pentair, Inc. to be held at 10:00
a.m., Wednesday, April 20, 1994, at the Northland Inn and Conference Center,
7101 Northland Circle, Brooklyn Park, Minnesota, and any adjournment thereof,
all shares of voting preferred stock of Pentair, Inc. allocated as of February
25, 1994 to my account in the Pentair, Inc. Retirement Savings and Stock
Incentive Plan, plus a pro rata portion of the shares that have not been
allocated to participant accounts or for which no instructions are received, as
designated below.

I understand that this card must be received by Norwest Bank Minnesota,
N.A., acting as tabulation agent for the Trustee, by April 13, 1994. If it is
not or if the voting instructions are invalid because not properly signed and
dated, the shares held in my account will be voted by State Street Bank and
Trust Company in the same proportion that the other participants in the plan
direct the Trustee to vote shares allocated to their accounts.

THE PENTAIR, INC. BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH PROPOSAL.

Charles A. Haggerty Harold V. Haverty D. Eugene Nugent
<PAGE>
2. PROPOSAL TO RATIFY the retention of Deloitte & Touche as independent
public accountants for the current fiscal year.

/ / FOR / / AGAINST / / ABSTAIN

3. In its discretion, the Trustee is authorized to vote upon such other
matters as may properly come before the meeting.

___________________________________
Signature of participant
Dated: ______________________, 1994
THIS CARD MUST BE DATED.

(Please sign exactly as your name appears on this Participant Voting Instruction
Form.)