MUELLER INDUSTRIES, INC.
1998 STOCK OPTION PLAN
(Amended and Restated as of June 30, 2000)
1. Purposes.
The Mueller Industries, Inc. 1998 Stock Option Plan (the "Plan")
is intended to attract and retain the best available personnel for
positions of substantial responsibility with Mueller Industries, Inc., a
Delaware corporation (the "Company"), and its subsidiary corporations, and
to provide additional incentive to such persons to exert their maximum
efforts toward the success of the Company and its subsidiary corporations.
The above aims will be effectuated through the granting of certain options
("Options") to purchase shares of the Company's common stock, par value
$.01 per share (the "Common Stock"). Under the Plan, the Company may
grant "incentive stock options" ("ISOs") within the meaning of Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"), or Options
which are not intended to be ISOs ("Non-Qualified Options").
2. Administration of the Plan.
The Plan shall be administered by the Board of Directors of the
Company (the "Board of Directors"), or a committee consisting of at least
two persons, appointed by the Board of Directors, each of whom shall be a
"non-employee director" within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934 (the "Exchange Act") (the entity
administering the Plan hereinafter called the "Committee"). The Committee
may exercise the power and authority vested in the Board of Directors
under the Plan. Within the limits of the express provisions of the Plan,
the Committee shall have the authority, in its discretion, to take the
following actions under the Plan:
(a) to determine the individuals to whom, and the time or
times at which, Options shall be granted, the number of shares of Common
Stock to be subject to each Option and whether such Options shall be ISOs
or Non-Qualified Options;
(b) to interpret the Plan;
(c) to prescribe, amend and rescind rules and regulations
relating to the Plan;
(d) to determine the terms and provisions of the respective
stock option agreements granting Options, including the date or dates upon
which Options shall become exercisable, which terms need not be identical;
(e) to accelerate the vesting of any outstanding Options;
and
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(f) to make all other determinations and take all other
actions necessary or advisable for the administration of the Plan.
In making such determinations, the Committee may take into
account the nature of the services rendered by such individuals, their
present and potential contributions to the Company's success, and such
other factors as the Committee, in its discretion, shall deem relevant.
An individual to whom an Option has been granted under the Plan is
referred to herein as an "Optionee". The Committee's determinations on
the matters referred to in this Section 2 shall be conclusive.
3. Shares Subject to the Plan.
The total number of shares of Common Stock which shall be
subject to Options granted under the Plan shall not exceed 600,000
(reflecting a two for one stock split in 1998), subject to adjustment as
provided in Section 7 hereof. The Company shall at all times while the
Plan is in force reserve such number of shares of Common Stock as will be
sufficient to satisfy the requirements of outstanding Options. The shares
of Common Stock to be issued upon exercise of Options shall be authorized
and unissued or reacquired shares of Common Stock. The shares of Common
Stock relating to the unexercised portion of any expired, terminated or
cancelled Option shall thereafter be available for the grant of Options
under the Plan.
4. Eligibility.
(a) Options may be granted under the Plan only to (i)
employees of the Company and (ii) employees of any "subsidiary
corporation" (a "Subsidiary") of the Company within the meaning of Section
424(f) of the Code; provided, however, that no person may be granted
Options under the Plan with respect to more than 70,000 shares of Common
Stock in any one year. The term "Company," when used in the context of an
Optionee's employment, shall be deemed to include Subsidiaries of the
Company.
(b) Nothing contained in the Plan shall be construed to
limit the right of the Company to grant stock options otherwise than under
the Plan for proper corporate purposes.
5. Terms of Options.
The terms of each Option granted under the Plan shall be
determined by the Committee consistent with the provisions of the Plan,
including the following:
(a) The purchase price of the shares of Common Stock subject
to each Option shall be fixed by the Committee, in its discretion, at the
time such Option is granted; provided,however, that in no event shall such
purchase price be less than the Fair Market Value (as defined in paragraph
(g) of this Section 5) of the shares of Common Stock as of the date such
Option is granted.
(b) The dates on which each Option (or portion thereof)
shall be exercisable shall be fixed by the Committee, in its discretion,
at the time such Option is granted.
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(c) The expiration of each Option shall be fixed by the
Committee, in its discretion, at the time such Option is granted. No
Option shall be exercisable after the expiration of ten (10) years from
the date of its grant and each Option shall be subject to earlier
termination as determined by the Committee, in its discretion, at the time
such Option is granted.
(d) Options shall be exercised by the delivery to the
Company at its principal office or at such other address as may be
established by the Committee (Attention: Corporate Treasurer) of written
notice of the number of shares of Common Stock with respect to which the
Option is being exercised accompanied by payment in full of the purchase
price of such shares. Unless otherwise determined by the Committee,
payment for such shares may be made (i) in cash, (ii) by certified check
or bank cashier's check payable to the order of the Company in the amount
of such purchase price, (iii) by delivery to the Company of shares of
Common Stock (held by the Optionee for at least six months prior to such
delivery) having a Fair Market Value equal to such purchase price, (iv) by
irrevocable instructions to a broker to deliver promptly to the Company
the amount of sale or loan proceeds necessary to pay such purchase price
and to sell the shares of Common Stock to be issued upon exercise of the
Option and deliver the cash proceeds less commissions and brokerage fees
to the Optionee or to deliver the remaining shares of Common Stock to the
Optionee, or (v) by any combination of the methods of payment described in
(i) through (iv) above.
(e) An Optionee shall not have any of the rights of a holder
of the Common Stock with respect to the shares of Common Stock subject to
an Option until such shares are issued to such Optionee upon the exercise
of such Option.
(f) Generally, an Option shall not be transferable, except
by will or the laws of descent and distribution, and may be exercised,
during the lifetime of an Optionee, only by the Optionee; provided,
however, that the Committee may, in its sole discretion, at the time of
grant or at any time thereafter, allow for the transfer of Options that
are not ISOs to other persons or entities, subject to such conditions or
limitations as it may establish. No Option granted under the Plan shall
be subject to execution, attachment or other process.
(g) For purposes of the Plan, as of any date when the Common
Stock is quoted on the NASDAQ Stock Market or listed on one or more
national securities exchanges, the "Fair Market Value" of the Common Stock
as of any date shall be deemed to be the mean between the highest and
lowest sale prices of the Common Stock reported on the NASDAQ Stock Market
or the principal national securities exchange on which the Common Stock is
listed and traded on the immediately preceding date, or, if there is no
such sale on that date, then on the last preceding date on which such a
sale was reported. If the Common Stock is not quoted on the NASDAQ Stock
Market or listed on an exchange, or representative quotes are not
otherwise available, the "Fair Market Value" of the Common Stock shall
mean the amount determined by the Committee to be the fair market value
based upon a good faith attempt to value the Common Stock accurately.
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6. Special Provisions Applicable to ISOs.
The following special provisions shall be applicable to ISOs
granted under the Plan.
(a) No ISOs shall be granted under the Plan after ten (10)
years from the earlier of (i) the date the Plan is adopted, or (ii) the
date the Plan is approved by the holders of the Common Stock.
(b) ISOs may not be granted to a person who owns stock
possessing more than 10% of the total combined voting power of all classes
of stock of the Company, any of its Subsidiaries, or any "parent
corporation" (a "Parent") of the Company within the meaning of Section
424(e) of the Code.
(c) If the aggregate Fair Market Value of the Common Stock
with respect to which ISOs are exercisable for the first time by any
Optionee during a calendar year (under all plans of the Company and its
Parents and Subsidiaries) exceeds $100,000, such ISOs shall be treated, to
the extent of such excess, as Non-Qualified Options. For purposes of the
preceding sentence, the Fair Market Value of the Common Stock shall be
determined at the time the ISOs covering such shares were granted.
7. Adjustment upon Changes in Capitalization.
(a) In the event that the outstanding shares of Common Stock
or the capital structure of the Company are changed by reason of
reorganization, merger, consolidation, recapitalization, reclassification,
stock split, reverse stock split, combination or exchange of shares and
the like, or dividends payable in shares of Common Stock, the Committee
shall make such appropriate adjustment to the aggregate number of shares
of Common Stock available under the Plan, the number of shares of Common
Stock subject to Options that may be granted to any person in any one
year, and in the number of shares of Common Stock and price per share of
Common Stock subject to outstanding Options as determined by the
Committee, in its sole discretion to be appropriate. If the Company shall
be reorganized, consolidated, or merged with another corporation, or if
all or substantially all of the assets of the Company shall be sold or
exchanged, an Optionee shall at the time of issuance of the stock under
such corporate event be entitled to receive upon the exercise of his
Option the same number and kind of shares of stock or the same amount of
property, cash or securities as he would have been entitled to receive
upon the occurrence of any such corporate event as if he had been,
immediately prior to such event, the holder of the number of shares of
Common Stock covered by his Option; provided, however, that if any such
event occurs or if the Company enters into an agreement to undertake any
such event, the Committee may, in its sole discretion, cancel any
outstanding options and pay to such Optionees, in cash or stock, or any
combination thereof, the value of such Options as determined by the
Committee based on the price per share of Common Stock received or to be
received by the stockholders of the Company upon such event.
(b) Any adjustment under this Section 7 in the number of
shares of Common Stock subject to Options shall apply proportionately to
only the unexercised portion of any Option granted hereunder. If
fractions of a share would result from any such adjustment, the adjustment
shall be revised to the next lower whole number of shares.
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8. Further Conditions of Exercise.
(a) The obligation of the Company to issue shares of Common
Stock pursuant to the exercise of Options shall be subject to all
applicable laws, rules and regulations, and to such approvals by
governmental agencies as may be required. Notwithstanding any of the
provisions hereof, the Optionee may not exercise the Options, and the
Company will be under no obligation to offer to sell or to sell and shall
be prohibited from offering to sell or selling any shares of Common Stock
pursuant to the exercise of any Option unless such exercise, offer or sale
shall be properly registered pursuant to the Securities Act of 1933 (as
now in effect or as hereafter amended) (the "Securities Act") with the
Securities and Exchange Commission or unless the Company has received an
opinion of counsel, satisfactory to the Company, that such shares may be
offered or sold without such registration pursuant to an available
exemption therefrom and the terms and conditions of such exemption have
been fully complied with. Any determination in this connection by the
Committee shall be final, binding and conclusive. The Company shall use
reasonable efforts to register the offer or sale of shares of Common Stock
underlying any Option pursuant to the Securities Act and to take any other
affirmative action in order to cause the exercise of the Options or the
issuance or transfer of shares pursuant thereto to comply with any law or
regulation of any governmental authority. If the shares of Common Stock
offered for sale or sold under any Option are offered or sold pursuant to
an exemption from registration under the Securities Act, the Company may
restrict the transfer of such shares and may legend the Common Stock
certificates representing such shares in such manner as it deems advisable
to ensure the availability of any such exemption.
(b) The Company is relieved from any liability for the non-
issuance or non-transfer or any delay in issuance or transfer of any
shares of Common Stock subject to Options which results from the inability
of the Company to obtain or in any delay in obtaining from any regulatory
body having jurisdiction all requisite authority to issue or transfer
shares of Common Stock of the Company either upon exercise of the Options
or shares of Common Stock issued as a result of such exercise if counsel
for the Company deems such authority necessary for lawful issuance or
transfer of any such shares.
9. Termination, Modification and Amendment.
(a) The Plan (but not Options previously granted under the
Plan) shall terminate ten (10) years from the date of its adoption by the
Board of Directors, and no Option shall be granted after termination of
the Plan.
(b) The Plan may at any time be terminated or, from time to
time, be modified or amended by the Board of Directors; provided, however,
that the Board of Directors shall not, without approval by the affirmative
vote of the holders of a majority of the shares of the capital stock of
the Company present in person or by proxy and entitled to vote at the
meeting, amend the Plan to (i) increase (except as provided by Section 7)
the maximum number of shares of Common Stock as to which Options may be
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granted under the Plan, (ii) increase the maximum number of shares as to
which Options may be granted to any person in any single year, (iii)
decrease the purchase price for Options below Fair Market Value at the
time of grant, or (iv) change the class of persons eligible to receive
Options under the Plan.
(c) No termination, modification or amendment of the Plan
may adversely affect the rights conferred by any Options without the
consent of the affected Optionee.
10. Effectiveness of the Plan.
The Plan shall become effective upon adoption by the Board of
Directors of the Company, subject to the approval by the shareholders of
the Company. Options may be granted under the Plan prior to receipt of
such approval, provided that, in the event such approval is not obtained,
the Plan and all Options granted under the Plan shall be null and void and
of no force and effect.
11. Not a Contract of Employment.
Nothing contained in the Plan or in any stock option agreement
executed pursuant hereto shall be deemed to confer upon any Optionee any
right to remain in the employ of the Company or of any Subsidiary.
12. Governing Law.
The Plan shall be governed by the laws of the State of Delaware
without reference to principles of conflict of laws thereof.
13. Withholding.
As a condition to the exercise of any Option, the Committee may
require that an Optionee satisfy, through withholding from other
compensation or otherwise, the full amount of all federal, state and local
income and other taxes required to be withheld in connection with such
exercise. The Committee may, in its sole discretion, allow for the
retention by the Company of shares of Common Stock otherwise to be
delivered to the Optionee upon the exercise of any Option in order to
satisfy this withholding requirement.
As adopted by the Board of Directors of Mueller Industries, Inc. as of
January , 1998 and amended and restated as of June 30, 2000.
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