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                                                                   EXHIBIT 10.12

                                STOCK OPTION PLAN
                                       OF
                                RBS GLOBAL, INC.

        RBS Global, Inc. (the "Company"), a Delaware corporation, hereby adopts
this Stock Option Plan of RBS Global, Inc. The purposes of this Plan are as
follows:

        (1)     To further the growth, development and financial success of the
        Company and its Subsidiaries (as defined herein), by providing
        additional incentives to employees, consultants and directors of the
        Company and its Subsidiaries who have been or will be given
        responsibility for the management or administration of the Company's (or
        one of its Subsidiaries') business affairs, by assisting them to become
        owners of Common Stock, thereby benefiting directly from the growth,
        development and financial success of the Company and its Subsidiaries.

        (2)     To enable the Company (and its Subsidiaries) to obtain and
        retain the services of the type of professional, technical and
        managerial employees, consultants and directors considered essential to
        the long-range success of the Company (and its Subsidiaries) by
        providing and offering them an opportunity to become owners of Common
        Stock under Options, including, in the case of employees, Options that
        are intended to qualify as "incentive stock options" under Section 422
        of the Code (as defined herein).

                                   ARTICLE I.
                                   DEFINITIONS

        Whenever the following terms are used in this Plan, they shall have the
meaning specified below unless the context clearly indicates to the contrary.
The singular pronoun shall include the plural where the context so indicates.

        SECTION 1.1     AFFILIATE

        "Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
such Person where "control" shall have the meaning given such term under Rule
405 of the Securities Act. For purposes of this Plan, Affiliates of Carlyle
Partners III, L.P., a Delaware limited liability company, shall include all
Persons directly or indirectly controlled by TC Group, L.L.C., a Delaware
limited liability company.

        SECTION 1.2     BOARD

        "Board" shall mean the Board of Directors of the Company.

        SECTION 1.3     CEO

        "CEO" shall mean Chief Executive Officer of the Company.

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        SECTION 1.4     CODE

        "Code" shall mean the Internal Revenue Code of 1986, as amended.

        SECTION 1.5     COMMITTEE

        "Committee" shall mean the Committee appointed as provided in Section
6.1.

        SECTION 1.6     COMMON STOCK

        "Common Stock" shall mean the Common Stock, par value $0.01 per share,
of the Company.

        SECTION 1.7     COMPANY

        "Company" shall mean RBS Global, Inc. In addition, "Company" shall mean
any corporation assuming, or issuing new employee stock options in substitution
for, Incentive Stock Options outstanding under the Plan in a transaction to
which Section 424(a) of the Code applies.

        SECTION 1.8     CONSULTANT

        "Consultant" shall mean any Person who has entered into a consulting
agreement with the Company.

        SECTION 1.9     CORPORATE EVENT

        "Corporate Event" shall mean, as determined by the Committee (or by the
Board, in the case of Options granted to Independent Directors) in its sole
discretion, any transaction or event described in Section 7.1(a) or any unusual
or nonrecurring transaction or event affecting the Company, any Subsidiary of
the Company, or the financial statements of the Company or any Subsidiary, or
changes in applicable laws, regulations, or accounting principles.

        SECTION 1.10    DIRECTOR

        "Director" shall mean a member of the Board.

        SECTION 1.11    ELIGIBLE REPRESENTATIVE

        "Eligible Representative" for an Optionee shall mean such Optionee's
personal representative or such other person as is empowered under the deceased
Optionee's will or the then applicable laws of descent and distribution to
represent the Optionee hereunder.

        SECTION 1.12    EMPLOYEE

        "Employee" shall mean any employee (as defined in accordance with the
regulations and revenue rulings then applicable under Section 3401(c) of the
Code) of the Company or one of its Subsidiaries, whether such employee is so
employed at the time this Plan is adopted or becomes so employed subsequent to
the adoption of this Plan.

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        SECTION 1.13    EXCHANGE ACT

        "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

        SECTION 1.14    INCENTIVE STOCK OPTION

        "Incentive Stock Option" shall mean an Option which qualifies under
Section 422 of the Code and is designated as an Incentive Stock Option by the
Committee.

        SECTION 1.15    INDEPENDENT DIRECTOR

        "Independent Director" shall mean a member of the Board who is not an
Employee of the Company or any of its Subsidiaries.

        SECTION 1.16    LIQUIDITY EVENT

        "Liquidity Event" shall mean the consummation of the sale, transfer,
conveyance or other disposition in one or a series of related transactions, of
the equity securities of the Company or its successor held by the Principal
Stockholder(s) in exchange for currency such that immediately following such
transaction (or transactions), the value (at original cost) of all equity
securities held by all of the Principal Stockholder(s) is in the aggregate less
than 20% of the equity securities (at original cost) held by the Principal
Stockholder(s) as of November 25, 2002.

        SECTION 1.17    NON-QUALIFIED STOCK OPTION

        "Non-Qualified Stock Option" shall mean an Option which is not an
"incentive stock option" under Section 422 of the Code and shall include an
Option which is designated as a Non-Qualified Stock Option by the Committee.

        SECTION 1.18    OFFICER

        "Officer" shall mean an officer of the Company, as defined in Rule
16a-l(f) under the Exchange Act, as such Rule may be amended in the future.

        SECTION 1.19    OPTION

        "Option" shall mean an option granted under the Plan to purchase Common
Stock. "Options" includes both Incentive Stock Options and Non-Qualified Stock
Options.

        SECTION 1.20    OPTIONEE

        "Optionee" shall mean an Employee, Consultant or Independent Director to
whom an Option is granted under the Plan.

        SECTION 1.21    PERSON

        "Person" shall mean an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority or other entity of whatever
nature.

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        SECTION 1.22    PLAN

        "Plan" shall mean this Stock Option Plan of RBS Global, Inc.

        SECTION 1.23    PRINCIPAL STOCKHOLDER(S)

        "Principal Stockholder(s)" shall mean Carlyle Partners III, L.P. or any
of its Affiliates to which (a) Carlyle Partners III, L.P. or any other Person
transfers Common Stock, or (b) the Company issues Common Stock.

        SECTION 1.24    SECRETARY

        "Secretary" shall mean the Secretary of the Company.

        SECTION 1.25    SECURITIES ACT

        "Securities Act" shall mean the Securities Act of 1933, as amended.

        SECTION 1.26    STOCKHOLDERS AGREEMENT

        "Stockholders Agreement" shall mean that certain agreement by and
between the Optionee and the Company which contains certain restrictions and
limitations applicable to the shares of Common Stock acquired upon Option
exercise (and to other shares of Common Stock, if any, held by the Optionee
during the term of such agreement). The Board, in its discretion, shall
determine the terms of the Stockholders Agreement and may amend the terms
thereof from time to time. If the Optionee is not a party to a Stockholders
Agreement at the time of exercise of the Option (or any portion thereof), the
exercise of the Option shall be subject to the condition that the Optionee enter
a Stockholders Agreement with the Company.

        SECTION 1.27    SUBSIDIARY

        "Subsidiary" of any entity shall mean any corporation in an unbroken
chain of corporations beginning with such entity if each of the corporations
other than the last corporation in the unbroken chain then owns stock possessing
50% or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.

        SECTION 1.28    TERMINATION OF DIRECTORSHIP

        "Termination of Directorship" shall mean the time when an Optionee who
is an Independent Director ceases to be a Director for any reason, including but
not by way of limitation, a termination by resignation, failure to be elected or
appointed, death or retirement. The Board, in its sole discretion, shall
determine the effect of all matters and questions relating to Termination of
Directorship.

        SECTION 1.29    TERMINATION OF EMPLOYMENT

        "Termination of Employment" shall mean the time when the
employee-employer relationship between an Optionee and the Company (or one of
its Subsidiaries) is terminated for

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any reason, with or without cause, including, but not by way of limitation, a
termination by resignation, discharge, death or retirement, but excluding a
termination where there is a simultaneous reemployment by the Company (or one of
its Subsidiaries). The Committee shall determine the effect of all matters and
questions relating to Termination of Employment, including, but not by way of
limitation, the question of whether a Termination of Employment resulted from a
discharge for good cause, and all questions of whether a particular leave of
absence constitutes a Termination of Employment; provided, however, that, with
respect to Incentive Stock Options, a leave of absence shall constitute a
Termination of Employment if, and to the extent that, such leave of absence
interrupts employment for the purposes of Section 422(a)(2) of the Code and the
then applicable regulations and revenue rulings under Section 442(a)(2) of the
Code.

                                   ARTICLE II.
                             SHARES SUBJECT TO PLAN

        SECTION 2.1     SHARES SUBJECT TO PLAN

        The shares of stock subject to Options shall be shares of Common Stock.
Subject to Section 7.1, the aggregate number of such shares which may be issued
upon exercise of Options is 234,457.

        SECTION 2.2     UNEXERCISED OPTIONS

        If any Option (or portion thereof) expires or is canceled without
having been fully exercised, the number of shares subject to such Option (or
portion thereof) but as to which such Option was not exercised prior to its
expiration or cancellation may again be optioned hereunder, subject to the
limitations of Section 2.1.

                                  ARTICLE III.
                               GRANTING OF OPTIONS

        SECTION 3.1     ELIGIBILITY

        Any Employee of the Company or one of its Subsidiaries, any Independent
Director and any Consultant shall be eligible to be granted Options, except as
provided in Section 3.2.

        SECTION 3.2     QUALIFICATION OF INCENTIVE STOCK OPTIONS

        No Incentive Stock Option shall be granted to any person who is not an
Employee.

        SECTION 3.3     GRANTING OF OPTIONS TO EMPLOYEES OR CONSULTANTS

                (a)     The Committee shall from time to time:

                        (i)     Select from among the Employees or Consultants
                        (including those to whom Options have been previously
                        granted under the Plan) such of them as in its opinion
                        should be granted Options;

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                        (ii)    Determine the number of shares to be subject to
                        such Options granted to such Employees or Consultants,
                        and determine whether such Options are to be Incentive
                        Stock Options or Non-Qualified Stock Options; and

                        (iii)   Determine the terms and conditions of such
                        Options, consistent with the Plan.

                (b)     Upon the selection of an Employee or Consultant to be
                granted an Option pursuant to Section 3.3(a), the Committee
                shall instruct the Secretary or another authorized officer of
                the Company to issue such Option and may impose such conditions
                on the grant of such Option as it deems appropriate. Without
                limiting the generality of the preceding sentence, the Committee
                may require as a condition to the grant of an Option to an
                Employee or Consultant that the Employee or Consultant surrender
                for cancellation some or all of the unexercised Options which
                have been previously granted to him or her. An Option the grant
                of which is conditioned upon such surrender may have an Option
                price lower (or higher) than the Option price of the surrendered
                Option, may cover the same (or a lesser or greater) number of
                shares as the surrendered Option, may contain such other terms
                as the Committee deems appropriate and shall be exercisable in
                accordance with its terms, without regard to the number of
                shares, price, period of exercisability or any other term or
                condition of the surrendered Option.

        SECTION 3.4     GRANTING OF OPTION TO INDEPENDENT DIRECTORS

                (a)     The Board shall from time to time:

                        (i)     Select from among the Independent Directors
                        (including those to whom Options have previously been
                        granted under the Plan) such of them as in its opinion
                        should be granted Options;

                        (ii)    Determine the number of shares to be subject to
                        such Options granted to such selected Independent
                        Directors; and

                        (iii)   Determine the terms and conditions of such
                        Options, consistent with the Plan; provided, however,
                        that all Options granted to Independent Directors shall
                        be Non-Qualified Stock Options.

                (b)     Upon the selection of an Independent Director to be
                granted an Option pursuant to Section 3.4(a), the Board shall
                instruct the Secretary or another authorized officer of the
                Company to issue such Option and may impose such conditions on
                the grant of such Option as it deems appropriate. Without
                limiting the generality of the preceding sentence, the Board may
                require as a condition to the grant of an Option to an
                Independent Director that the Independent Director surrender for
                cancellation some or all of the unexercised Options which have
                been previously granted to him or her. An Option the grant of
                which is conditioned upon such surrender may have an Option
                price lower (or higher) than the Option price of the surrendered
                Option, may cover the same (or a lesser or greater)

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                number of shares as the surrendered Option, may contain such
                other terms as the Board deems appropriate and shall be
                exercisable in accordance with its terms, without regard to the
                number of shares, price, period of exercisability or any other
                term or condition of the surrendered Option.

                                   ARTICLE IV.
                                TERMS OF OPTIONS

        SECTION 4.1     STOCK OPTION AGREEMENT

        Each Option shall be evidenced by a written Stock Option Agreement,
which shall be executed by the Optionee and an authorized Officer of the Company
and which shall contain such terms and conditions as the Committee (or the
Board, in the case of Options granted to Independent Directors) shall determine,
consistent with the Plan. Stock Option Agreements evidencing Incentive Stock
Options shall contain such terms and conditions as may be necessary to qualify
such Options as "incentive stock options" under Section 422 of the Code.

        SECTION 4.2     EXERCISABILITY OF OPTIONS

                (a)     Each Option shall become exercisable according to the
                terms of the applicable Stock Option Agreement; provided,
                however, that by a resolution adopted after an Option is granted
                the Committee (or the Board, in the case of Options granted to
                Independent Directors) may, on such terms and conditions as it
                may determine to be appropriate, accelerate the time at which
                such Option or any portion thereof may be exercised.

                (b)     Except as otherwise provided in the applicable Stock
                Option Agreement, no portion of an Option which is unexercisable
                at Termination of Employment, Termination of Directorship or
                Termination of Consultancy, as applicable, shall thereafter
                become exercisable.

                (c)     To the extent that the aggregate fair market value of
                stock with respect to which "incentive stock options" (within
                the meaning of Section 422 of the Code, but without regard to
                Section 422(d) of the Code) are exercisable for the first time
                by an Optionee during any calendar year (under the Plan and all
                other incentive stock option plans of the Company or any
                Subsidiary thereof) exceeds $100,000, such options shall be
                treated and taxable as Non-Qualified Stock Options. The rule set
                forth in the preceding sentence shall be applied by taking
                options into account in the order in which they were granted,
                and the stock issued upon exercise of options shall designate
                whether such stock was acquired upon exercise of an Incentive
                Stock Option. For purposes of these rules, the fair market value
                of stock shall be determined as of the date of grant of the
                Option granted with respect to such stock.

        SECTION 4.3     OPTION PRICE

                (a)     The price of the shares subject to each Option shall be
                set by the Committee (or the Board, in the case of Options
                granted to Independent

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                Directors); provided, however, that in the case of an Incentive
                Stock Option, the price per share shall be not less than 100% of
                the fair market value of such shares on the date such Option is
                granted; and that in the case of an individual then owning
                (within the meaning of Section 424(d) of the Code) more than 10%
                of the total combined voting power of all classes of stock of
                the Company, the price per share shall not be less than 110% of
                the fair market value of such shares on the date such Incentive
                Stock Option is granted.

                (b)     For purposes of the Plan, the fair market value of a
                share of Common Stock as of a given date shall be:

                        (i)     if the Common Stock is listed on one or more
                        National Securities Exchanges (within the meaning of the
                        Exchange Act), each share of Common Stock shall be
                        valued at the average closing price of a share of such
                        class of Common Stock on the principal exchange on which
                        such shares are then trading, on the twenty trading days
                        immediately preceding such date;

                        (ii)    if the Common Stock is not traded on a National
                        Securities Exchange but is quoted on NASDAQ or a
                        successor quotation system and the Common Stock is
                        listed as a National Market Issue under the NASD
                        National Market System, each share of Common Stock shall
                        be valued at the average of the last sales price on each
                        of the twenty trading days immediately preceding such
                        date as reported by NASDAQ or such successor quotation
                        system; or

                        (iii)   if the class of Common Stock is not publicly
                        traded on a National Securities Exchange and is not
                        quoted on NASDAQ or a successor quotation system, the
                        fair market value of the Common Stock shall be
                        determined in good faith by the Committee.

        SECTION 4.4     EXPIRATION OF OPTIONS

        No Option may be exercised to any extent by anyone after the first to
occur of the following events:

                (a)     The expiration of ten years from the date the Option was
                granted; or

                (b)     With respect to an Incentive Stock Option in the case of
                an Optionee owning (within the meaning of Section 424(d) of the
                Code), at the time the Incentive Stock Option was granted, more
                than 10% of the total combined voting power of all classes of
                stock of the Company or any subsidiary corporation, the
                expiration of five years from the date the Incentive Stock
                Option was granted.

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                                   ARTICLE V.
                               EXERCISE OF OPTIONS

        SECTION 5.1     PERSON ELIGIBLE TO EXERCISE

        During the lifetime of the Optionee, only he or she may exercise an
Option (or any portion thereof granted to him or her; provided, however, that
the Optionee's Eligible Representative may exercise his or her Option during the
period of the Optionee's disability (as defined in Section 22(e)(3) of the Code)
notwithstanding that an Option so exercised may not qualify as an Incentive
Stock Option. After the death of the Optionee, any exercisable portion of an
Option may, prior to the time when such portion becomes unexercisable under the
Plan or the applicable Stock Option Agreement, be exercised by his or her
Eligible Representative.

        SECTION 5.2     PARTIAL EXERCISE

        At any time and from time to time prior to the time when the Option
becomes unexercisable under the Plan or the applicable Stock Option Agreement,
the exercisable portion of an Option may be exercised in whole or in part;
provided, however, that the Company shall not be required to issue fractional
shares and the Committee (or the Board, in the case of Options granted to
Independent Directors) may, by the terms of the Option, require any partial
exercise to exceed a specified minimum number of shares.

        SECTION 5.3     MANNER OF EXERCISE

        An exercisable Option, or any exercisable portion thereof, may be
exercised solely by delivery to the Secretary of all of the following prior to
the time when such Option or such portion becomes unexercisable under the Plan
or the applicable Stock Option Agreement:

                (a)     Notice in writing signed by the Optionee or his or her
                Eligible Representative, stating that such Option or portion is
                exercised, and specifically stating the number of shares with
                respect to which the Option is being exercised;

                (b)     A copy of the Stockholders Agreement signed by the
                Optionee or Eligible Representative, as applicable;

                (c)     Full payment (in cash or by personal, certified, or bank
                cashier check) for the shares with respect to which such Option
                or portion is thereby exercised; or

                        (i)     With the consent of the Committee (or the Board,
                        in the case of Options to Independent Directors), (A)
                        shares of Common Stock owned by the Optionee duly
                        endorsed for transfer to the Company; or (B) except with
                        respect to Incentive Stock Options, shares of the Common
                        Stock issuable to the Optionee upon exercise of the
                        Option, with a fair market value (as determined under
                        Section 4.3(b)) on the date of Option exercise equal to
                        the aggregate Option price of the shares with respect to
                        which such Option or portion is thereby exercised; or

                        (ii)    With the consent of the Committee (or the Board,
                        in the case of Options granted to Independent
                        Directors), any combination of the consideration listed
                        in this subsection (c);

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                (d)     The payment to the Company (in cash or by personal,
                certified or bank cashier or by any other means of payment
                approved by the Committee) of all amounts necessary to satisfy
                any and all federal, state and local tax withholding
                requirements arising in connection with the exercise of the
                Option;

                (e)     Such representations and documents as the Committee (or
                the Board, in the case of Options granted to Independent
                Directors) deems necessary or advisable to effect compliance
                with all applicable provisions of the Securities Act and any
                other federal or state securities laws or regulations. The
                Committee (or the Board, in the case of Options granted to
                Independent Directors) may, in its sole discretion, also take
                whatever additional actions it deems appropriate to effect such
                compliance including, without limitation, placing legends on
                share certificates and issuing stop-transfer orders to transfer
                agents and registrars; and

                (f)     In the event that the Option or portion thereof shall be
                exercised pursuant to Section 5.1 by any person or persons other
                than the Optionee, appropriate proof of the right of such person
                or persons to exercise the Option or portion thereof.

        SECTION 5.4     CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES

        The shares of stock issuable and deliverable upon the exercise of an
Option, or any portion thereof, may be either previously authorized but unissued
shares or issued shares which have then been reacquired by the Company. A
certificate of shares will be delivered to the Optionee at the Company's
principal place of business within thirty days of receipt by the Company of the
written notice and payment, unless an earlier date is agreed upon.
Notwithstanding the above, the Company shall not be required to issue or deliver
any certificate or certificates for shares of stock purchased upon the exercise
of any Option or portion thereof prior to fulfillment of all of the following
conditions:

                (a)     The admission of such shares to listing on any and all
                stock exchanges on which such class of stock is then listed;

                (b)     The completion of any registration or other
                qualification of such shares under any state or federal law or
                under the rulings or regulations of the Securities and Exchange
                Commission or any other governmental regulatory body, which the
                Committee (or the Board, in the case of Options granted to
                Independent Directors) shall, in its sole discretion, deem
                necessary or advisable;

                (c)     The obtaining of any approval or other clearance from
                any state or federal governmental agency which the Committee (or
                the Board, in the case of Options granted to Independent
                Directors) shall, in its sole discretion, determine to be
                necessary or advisable; and

                (d)     The payment to the Company of all amounts which it is
                required to withhold under federal, state or local law in
                connection with the exercise of the Option.

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        SECTION 5.5     RIGHTS AS STOCKHOLDERS

        The holder of an Option shall not be, nor have any of the rights or
privileges of, a stockholder of the Company in respect of any shares purchasable
upon the exercise of any part of an Option unless and until such holder has
signed a Stockholders Agreement and certificates representing such shares have
been issued by the Company to such holder.

        SECTION 5.6     TRANSFER RESTRICTIONS

        Shares acquired upon exercise of an Option shall be subject to the
terms and conditions of a Stockholders Agreement. In addition, the Committee (or
the Board, in the case of Options granted to Independent Directors), in its sole
discretion, may impose further restrictions on the transferability of the shares
purchasable upon the exercise of an Option as it deems appropriate. Any such
restriction shall be set forth in the respective Stock Option Agreement and may
be referred to on the certificates evidencing such shares. The Committee may
require the Employee to give the Company prompt notice of any disposition of
shares of stock, acquired by exercise of an Incentive Stock Option, within two
years from the date of granting such Option or one year after the transfer of
such shares to such Employee. The Committee may direct that the certificates
evidencing shares acquired by exercise of an Incentive Stock Option refer to
such requirement.

                                   ARTICLE VI.
                                 ADMINISTRATION

        SECTION 6.1     COMMITTEE

        The Committee shall be the Compensation Committee of the Board. Any
action required or permitted to be taken by the Committee hereunder or under any
Stock Option Agreement may be taken by the Board.

        SECTION 6.2     DELEGATION BY COMMITTEE

        Except as otherwise determined by the Committee, all rights, powers and
duties of the Committee under the Plan (except those granted pursuant to
Sections 3.3, 4.3, 5.3(c), 5.3(e), 5.6 and Article VII) shall be exercised by
the CEO, subject to the approval of the Committee.

        SECTION 6.3     DUTIES AND POWERS OF CEO AND THE COMMITTEE

        It shall be the duty of the CEO, subject to the approval of the
Committee, to conduct the general administration of the Plan in accordance with
its provisions. The CEO, subject to the approval of the Committee, shall have
the power to interpret the Plan and the Options and to adopt such rules for the
administration, interpretation and application of the Plan as are consistent
therewith and to interpret, amend or revoke any such rules. Notwithstanding the
foregoing, the full Board, acting by a majority of its members in office, shall
conduct the general administration of the Plan with respect to Options granted
to Independent Directors. Any such interpretations and rules in regard to
Incentive Stock Options shall be consistent with the terms and conditions
applicable to "incentive stock options" within the meaning of Section 422 of the
Code. All determinations and decisions made by the CEO and approved by the
Committee under any provision of the Plan or of any Option granted thereunder
shall be final, conclusive and binding on all persons.

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        SECTION 6.4     COMPENSATION, PROFESSIONAL ASSISTANCE, GOOD FAITH
                        ACTIONS

        The members of the Committee shall receive such compensation for their
services hereunder as may be determined by the Board. All expenses and
liabilities incurred by the members of the Committee or the Board in connection
with the administration of the Plan shall be borne by the Company. The Committee
or the Board may employ attorneys, consultants, accountants, appraisers, brokers
or other persons. The Committee, the Company and its Officers and Directors
shall be entitled to rely upon the advice, opinions or valuations of any such
persons. All actions taken and all interpretations and determinations made by
the CEO, the Committee and the Board, in good faith shall be final and binding
upon all Optionees, the Company and all other interested persons. No member of
the Board or the CEO shall be personally liable for any action, determination or
interpretation made in good faith with respect to the Plan or the Options, and
all members of the Board shall be fully protected by the Company in respect to
any such action, determination or interpretation.

                                  ARTICLE VII.
                                OTHER PROVISIONS

        SECTION 7.1     CHANGES IN COMMON STOCK; DISPOSITION OF ASSETS AND
                        CORPORATE EVENTS.

                (a)     Subject to Section 7.1(d), in the event that the
                Committee (or the Board, in the case of Options granted to
                Independent Directors) determines that any dividend or other
                distribution (whether in the form of cash, Common Stock, other
                securities, or other property), recapitalization,
                reclassification, stock split, reverse stock split,
                reorganization, merger, consolidation, split-up, spin-off,
                combination, repurchase, liquidation, dissolution, or sale,
                transfer, exchange or other disposition of all or substantially
                all of the assets of the Company (including, but not limited to,
                a Liquidity Event), or exchange of Common Stock or other
                securities of the Company, issuance of warrants or other rights
                to purchase Common Stock or other securities of the Company, or
                other similar corporate transaction or event, in the Committee's
                sole discretion (or in the case of Options granted to
                Independent Directors, the Board's sole discretion), affects the
                Common Stock such that an adjustment is determined by the
                Committee (or the Board, in the case of Options granted to
                Independent Directors) to be appropriate in order to prevent
                dilution or enlargement of the benefits or potential benefits
                intended to be made available under the Plan or with respect to
                an Option, then the Committee (or the Board, in the case of
                Options granted to Independent Directors) shall, in such manner
                as it may deem equitable, adjust any or all of:

                        (i)     The number and kind of shares of Common Stock
                        (or other securities or property) with respect to which
                        Options may be granted under the Plan (including, but
                        not limited to, adjustments of the limitations in
                        Section 2.1 on the maximum number and kind of shares
                        which may be issued);

                        (ii)    The number and kind of shares of Common Stock
                        (or other securities or property) subject to outstanding
                        Options;

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                        (iii)   The exercise price with respect to any Option;
                        and

                        (iv)    The financial or other "targets" specified in
                        each Stock Option Agreement for determining the
                        exercisability of Options.

                (b)     Subject to Section 7.1(d) and the terms of outstanding
                Options, upon the occurrence of a Corporate Event, the Committee
                (or the Board, in the case of options granted to Independent
                Directors), in its sole discretion, is hereby authorized to take
                any one or more of the following actions whenever the Committee
                (or the Board, in the case of Options granted to Independent
                Directors) determines that such action is appropriate in order
                to prevent dilution or enlargement of the benefits or potential
                benefits intended to be made available under the Plan or with
                respect to any Option under this Plan, to facilitate such
                Corporate Event or to give effect to such changes in laws,
                regulations or principles:

                        (i)     In its sole discretion, and on such terms and
                        conditions as it deems appropriate, the Committee (or
                        the Board, in the case of Options granted to Independent
                        Directors) may provide, either by the terms of the
                        applicable Stock Option Agreement or by action taken
                        prior to the occurrence of such Corporate Event and
                        either automatically or upon the Optionee's request, for
                        either the purchase of any such Option for an amount of
                        cash, securities, or other property equal to the amount
                        that could have been attained upon the exercise of the
                        vested portion of such Option (and such additional
                        portion of the Option as the Board or Committee may
                        determine) immediately prior to the occurrence of such
                        transaction or event, or the replacement of such vested
                        (and other) portion of such Option with other rights or
                        property selected by the Committee (or the Board, in the
                        case of Options granted to Independent Directors) in its
                        sole discretion;

                        (ii)    In its sole discretion, the Committee (or the
                        Board, in the case of Options granted to Independent
                        Directors) may provide, either by the terms of the
                        applicable Stock Option Agreement or by action taken
                        prior to the occurrence of such Corporate Event, that
                        the Option (or any portion thereof) cannot be exercised
                        after such event;

                        (iii)   In its sole discretion, and on such terms and
                        conditions as it deems appropriate, the Committee (or
                        the Board, in the case of Options granted to Independent
                        Directors) may provide, either by the terms of the
                        applicable Stock Option Agreement or by action taken
                        prior to the occurrence of such Corporate Event, that
                        for a specified period of time prior to such Corporate
                        Event, such Option shall be exercisable as to all shares
                        covered thereby or a specified portion of such shares,
                        notwithstanding anything to the contrary in (A) Section
                        4.2; or (B) the provisions of the applicable Stock
                        Option Agreement;

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                        (iv)    In its sole discretion, and on such terms and
                        conditions as it deems appropriate, the Committee (or
                        the Board, in the case of Options granted to Independent
                        Directors) may provide, either by the terms of the
                        applicable Stock Option Agreement or by action taken
                        prior to the occurrence of such Corporate Event, that
                        upon such event, such Option (or any portion thereof) be
                        assumed by the successor or survivor corporation, or a
                        parent or subsidiary thereof, or shall be substituted
                        for by similar options, rights or awards covering the
                        stock of the successor or survivor corporation, or a
                        parent or subsidiary thereof, with appropriate
                        adjustments as to the number and kind of shares and
                        prices; and

                        (v)     In its sole discretion, and on such terms and
                        conditions as it deems appropriate, the Committee (or
                        the Board, in the case of Options granted to Independent
                        Directors) may make adjustments in the number and type
                        of shares of Common Stock (or other securities or
                        property) subject to outstanding Options (or any portion
                        thereof) and/or in the terms and conditions of
                        (including the exercise price), and the criteria
                        included in, outstanding Options and Options which may
                        be granted in the future.

                (c)     Subject to Section 7.1(d), the Committee (or the Board,
                in the case of Options granted to Independent Directors) may, in
                its sole discretion, include such further provisions and
                limitations in any Stock Option Agreement as it may deem
                equitable and in the best interests of the Company and its
                Subsidiaries.

                (d)     With respect to Incentive Stock Options, no adjustment
                or action described in this Section 7.1 or in any other
                provision of the Plan shall be authorized to the extent that
                such adjustment or action would cause the Plan to violate
                Section 422(b)(1) of the Code or any successor provisions
                thereto, unless the Committee determines that the Plan and/or
                the Options are not to comply with Section 422(b)(1) of the
                Code. The number of shares of Common Stock subject to any Option
                shall always be rounded up to the next higher whole number.

        SECTION 7.2     OPTIONS NOT TRANSFERABLE

        No Option or interest or right therein or part thereof shall be liable
for the debts, contracts or engagements of the Optionee or his or her successors
in interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law, by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect; provided, however, that nothing in this Section 7.2 shall
prevent transfers by will or by the applicable laws of descent and distribution.

        SECTION 7.3     AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN

        The Plan may be wholly or partially amended or otherwise modified,
suspended or terminated at any time or from time to time by the Board or the
Committee. However, without

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<Page>

stockholder approval within 12 months before or after such action no action of
the Board or the Committee may, except as provided in Section 7.1, increase any
limit imposed in Section 2.1 on the maximum number of shares which may be issued
on exercise of Options, reduce the minimum Option price requirements of Section
4.3(a), or extend the limit imposed in this Section 7.3 on the period during
which options may be granted. Except as provided by Section 7.1, neither the
amendment, suspension nor termination of the Plan shall, without the consent of
the holder of the Option, alter or impair any rights or obligations under any
Option theretofore granted. No Option may be granted during any period of
suspension nor after termination of the Plan, and in no event may any Option be
granted under this Plan after the expiration of ten years from the date the Plan
is adopted by the Board.

        SECTION 7.4     EFFECT OF PLAN UPON OTHER OPTION AND COMPENSATION PLANS

        The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for the Company or any Subsidiary. Nothing in this
Plan shall be construed to limit the right of the Company or any Subsidiary (a)
to establish any other forms of incentives or compensation for directors,
consultants or employees of the Company (or any Subsidiary); or (b) to grant or
assume options otherwise than under this Plan in connection with any proper
corporate purpose, including, but not by way of limitation, the grant or
assumption of options in connection with the acquisition by purchase, lease,
merger, consolidation or otherwise, of the business, stock or assets of any
corporation, firm or association.

        SECTION 7.5     APPROVAL OF PLAN BY STOCKHOLDERS

        This Plan will be submitted for the approval of the Company's
stockholders within 12 months after the date of the Board's initial adoption of
this Plan and the Plan and the Options granted hereunder will be effective upon
approval by such stockholders as contemplated by Section 280G(b)(5)(A)(ii) of
the Code and regulations thereunder as if a "change in control" occurred
immediately following such approval. No Option may be exercised to any extent by
anyone unless and until the Plan is so approved by the stockholders, and if such
approval has not been obtained by the end of said 12-month period, the Plan and
all Options theretofore granted shall thereupon be canceled and become null and
void.

        SECTION 7.6     TITLES

        Titles are provided herein for convenience only and are not to serve as
a basis for interpretation or construction of the Plan.

        SECTION 7.7     CONFORMITY TO SECURITIES LAWS

        The Plan is intended to conform to the extent necessary with all
provisions of the Securities Act and the Exchange Act and any and all
regulations and rules promulgated by the Securities and Exchange Commission
thereunder to the extent the Company or any Optionee is subject to the
provisions thereof. Notwithstanding anything herein to the contrary, the Plan
shall be administered, and Options shall be granted and may be exercised, only
in such a manner as to conform to such laws, rules and regulations. To the
extent permitted by applicable law, the Plan and Options granted hereunder shall
be deemed amended to the extent necessary to conform to such laws, rules and
regulations.

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        SECTION 7.8     GOVERNING LAW

        To the extent not preempted by federal law, the Plan shall be construed
in accordance with and governed by the laws of the state of Delaware.

        SECTION 7.9     SEVERABILITY

        In the event any portion of the Plan or any action taken pursuant
thereto shall be held illegal or invalid for any reason, the illegality or
invalidity shall not affect the remaining parts of the Plan, and the Plan shall
be construed and enforced as if the illegal or invalid provisions had not been
included, and the illegal or invalid action shall be null and void.

                                       16
<Page>

        I hereby certify that the foregoing Plan was duly adopted by the
Committee on November 25, 2002 pursuant to delegation from the Board of
Directors of RBS Global, Inc. on November 25, 2002.

        Executed on this 25 day of November, 2002.


                                                              /s/
                                            ------------------------------------
                                            Name:       Praveen R. Jeyarajah
                                                  ------------------------------
                                            Secretary

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