Page 29 of 29 – SEC Filing
EXHIBIT 5
As of May 10, 2016
Mr. Edward P. Garden
280 Park Avenue, 41st Floor
New York, New York 10017
Dear Ed:
In connection with the investment in Pentair plc (“PNR”) by funds managed by Trian Fund Management, L.P. (“Trian”), you were appointed as a director of PNR by its board of directors.
We understand that, consistent with its practices, PNR will be awarding to you, as a director of PNR, equity compensation in the form of (i) restricted stock units (the “RSUs”) and (ii) options to purchase ordinary shares (the “Options”, and collectively with the RSUs, the “Equity Awards”), and will be paying to you, in cash, an annual retainer for your service on its board of directors and certain committees of its board of directors (the “Fees”). This is to confirm our prior understanding that you are authorized to accept such Equity Awards and Fees in your individual capacity on behalf of Trian upon the terms and conditions of this letter, including your agreement that, as long as you are an officer of Trian and for a period of six months and one day thereafter, you will follow the direction of Trian with respect to (x) the exercise and Transfer (as defined below) of any such Equity Awards and (y) the Transfer of any ordinary shares of PNR that you receive upon exercise or conversion of such Equity Awards (“Shares”) or any other securities you may receive as a director of PNR (“Other Securities”). You further agree that (i) you will request that PNR deliver all Fees directly to an account designated by Trian, (ii) you will not dispose of, transfer, sell, assign, pledge, hypothecate or encumber (collectively, “Transfer”) any Equity Awards, Shares or Other Securities, without Trian’s prior written consent, which may be withheld in Trian’s sole discretion, (iii) you shall vote all such Shares and Other Securities at any meeting of shareholders of PNR in the manner that you are directed to do so by Trian in its sole discretion and (iv) you shall execute any written consent of the shareholders of PNR as Trian may, in its sole discretion, request that you execute. Upon any Transfer of all or a portion of the Equity Awards, Shares or Other Securities, Trian shall be entitled to receive the consideration received as a result of such Transfer (the “Equity Consideration“).
Trian agrees to indemnify you against any tax imposed on income to you, net of any corresponding deduction to which you are entitled as a result of the transfer of the Fees and Equity Consideration to Trian. Such indemnification shall include all taxes imposed on a tax indemnification payment and shall apply to income reported by either PNR or Trian. For purposes of this letter agreement, taxes shall include any penalties, interest or additions to tax imposed upon you with respect to taxes.
This letter agreement shall be governed by, and construed in accordance with, the laws of the State of New York, applicable to agreements made and to be performed entirely within such State.
This letter shall be binding upon the parties hereto and their respective successors, assigns, heirs and estates.
If the above is acceptable to you, please indicate your agreement by signing the enclosed duplicate copy of this letter agreement in the space indicated below.
Very truly yours,
TRIAN FUND MANAGEMENT, L.P.
By: Trian Fund Management GP, LLC,
its general partner
By: /s/ PETER W. MAY
Name: Peter W. May
Title: Member
Agreed to and Accepted:
/s/ EDWARD P. GARDEN
Edward P. Garden
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