<PAGE>   1
                                                                    EXHIBIT 10.4

                               IMCO RECYCLING INC.
                     AMENDED AND RESTATED STOCK OPTION PLAN

           (as amended May 7, 1991, November 5, 1992 and May 13, 1997)


                                     PURPOSE

         The purpose of the Plan is to attract and retain key employees of the
Company and to provide such persons with a proprietary interest in the Company
through the granting of Incentive Stock Options and Nonqualified Stock Options
which will:

         (a) increase the interest of the employees in the Company's welfare;

         (b) furnish an incentive to the employees to continue their services
             for the Company; and

         (c) provide a means through which the Company may attract able persons
             to enter its employ.

                                    ARTICLE I
                                   DEFINITIONS

         For the purpose of this Plan, unless the context requires otherwise,
the following terms shall have the meanings indicated:

         1.1 "Board" means the board of directors of the Company.

         1.2 "Change in Control" means the occurrence of any of the following
events: (i) there shall be consummated (x) any consolidation or merger of the
Company in which the Company is not the continuing or surviving corporation or
pursuant to which shares of the Company's Common Stock would be converted into
cash, securities or other property, other than a merger of the Company in which
the holders of the Company's Common Stock immediately prior to the merger have
the same proportionate ownership of common stock of the surviving corporation
immediately after the merger, or (y) any sale, lease, exchange or other transfer
(excluding transfer by way of pledge or hypothecation), in one transaction or a
series of related transactions, of all, or substantially all, of the assets of
the Company, (ii) the stockholders of the Company approve any plan or proposal
for the liquidation or dissolution of the Company, (iii) any "person" (as such
term is defined in Section 3(a)(9) or Section 13(d)(3) under the 1934 Act) or
any "group" (as such term is used in Rule 13d-5 promulgated under the 1934 Act),
other than the Company or any successor of the Company or any Subsidiary of the
Company or any employee benefit plan of the Company or any Subsidiary (including
such plan's trustee), becomes a beneficial owner for purposes of Rule 13d-3
promulgated under the 1934 Act, directly or indirectly, of securities of the
Company representing 50.1% or more of the Company's then outstanding securities
having the right to vote in the election of directors, or (iv) during any 

                                       1

<PAGE>   2

period of two consecutive years, individuals who, at the beginning of such
period constituted the entire Board, cease for any reason (other than death) to
constitute a majority of the directors, unless the election, or the nomination
for election, by the Company's stockholders, of each new director was approved
by a vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period.

         1.3  "Code" means the Internal Revenue Code of 1986, as amended.

         1.4  "Common Stock" means the common stock which the Company is 
currently authorized to issue or may in the future be authorized to issue.

         1.5  "Company" means IMCO Recycling Inc., a Delaware corporation.

         1.6  "Date of Grant" means the effective date on which an option is 
awarded to an employee as set forth in the stock option agreement.

         1.7  "Incentive Stock Option" means an option to purchase shares of 
Common Stock granted to a Participant pursuant to Article V and which is 
intended to qualify as an incentive stock option under Section 422 of the Code.

         1.8  "1934 Act" means the Securities Exchange Act of 1934, as amended.

         1.9  "Nonqualifying Stock Option" means an option to purchase shares of
Common Stock granted to a Participant pursuant to Article V and which is not 
intended to qualify as an incentive stock option under Section 422 of the Code.

         1.10 "Participant" means any employee of the Company who is, or who is
proposed to be, a recipient of a Stock Option.

         1.11 "Plan" means IMCO Recycling Inc. Amended and Restated Stock Option
Plan, as it may be amended from time to time.

         1.12 "Stock Options" shall mean any and all Incentive Stock Options and
Nonqualified Stock Options granted pursuant to the Plan.

         1.13 "Subsidiary" means any corporation in an unbroken chain of 
corporations beginning with the Company if, at the time of granting of the Stock
Option, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of 
all classes of stock in one of the other corporations in the chain, and 
"Subsidiaries" means more than one of any such corporations.

                                       2

<PAGE>   3


                                   ARTICLE II
                                 ADMINISTRATION

         Subject to the terms of this Article II, the Plan shall be administered
by the Compensation Committee (the "Committee") of the Board, which shall
consist of at least two members. Any member of the Committee may be removed at
any time, with or without cause, by resolution of the Board. Any vacancy
occurring in the membership of the Committee may be filled by appointment by the
Board. Each member of the Committee, at the time of his appointment to the
Committee and while he is a member thereof, must be "disinterested." For the
purposes of the Plan, a member of the Committee shall be deemed to be
"disinterested" at any time only if the Company has not, within one (1) year
prior to the time such person became a member of the Committee, granted or
awarded any shares of Common Stock, any options to acquire Common Stock, or any
other "equity security" (as defined in Rule 16b-3 promulgated under the 1934
Act) of the Company, to such person pursuant to the Plan or any other benefits
plan of the Company or any of its affiliates.

         The Committee shall select one of its members to act as its Chairman,
and shall make such rules and regulations for its operation as it deems
appropriate. A majority of the Committee shall constitute a quorum and the act
of a majority of the members of the Committee present at a meeting at which a
quorum is present shall be the act of the Committee. Subject to the terms
hereof, the Committee shall designate from time to time the key employees to
whom Stock Options will be granted, interpret the Plan, prescribe, amend, and
rescind any rules and regulations necessary or appropriate for the
administration of the Plan, and make such other determinations and take such
other action as it deems necessary or advisable. In this regard, the Committee
shall consider and give appropriate weight to input from representatives of
management of the Company regarding the contributions or potential contributions
to the Company of certain of the employees or potential employees of the
Company. Except as provided below, any interpretation, determination, or other
action made or taken by the Committee shall be final, binding, and conclusive on
all interested parties, including the Company and all Participants.

                                   ARTICLE III
                                   ELIGIBILITY

         The Committee shall, from time to time, select the particular key
employees of the Company and its Subsidiaries to whom the Stock Options provided
under the Plan are to be granted and/or distributed in recognition of each such
employee's contribution to the Company's success.

                                   ARTICLE IV
                             SHARES SUBJECT TO PLAN

         The Committee may not grant Stock Options under the Plan for more than
1,200,000 shares of Common Stock of the Company (as may be adjusted in
accordance with Article IX or X hereof). As set forth in Section 12.7 hereof,
this Plan amends and restates the Company's 

                                       3

<PAGE>   4

Nonqualified Stock Option Plan, which authorized the Committee to grant
Nonqualified Stock Options to acquire up to an aggregate of 850,000 shares of
Common Stock. As of the date of adoption of the Plan (i.e., March 6, 1990) by
the Board, options covering 776,000 shares have been granted under the
Nonqualified Stock Option Plan, of which options to purchase 100,000 of such
shares have been exercised (resulting in options outstanding to purchase 676,000
shares under the Plan as of such date of adoption). It is intended that the Plan
incorporated under its terms all outstanding stock options which have been
granted pursuant to the Nonqualified Stock Option Plan. Shares to be distributed
and sold may be made available from either authorized but unissued Common Stock
or Common Stock held by the Company in its treasury. Shares that by reason of
the expiration or unexercised termination of a Stock Option are no longer
subject to purchase may be reoffered under the Plan.

                                    ARTICLE V
                                  STOCK OPTIONS

         5.1 GRANT OF STOCK OPTIONS. All grants of Stock Options under the Plan
shall be awarded by the Committee. The grant of Stock Options shall be evidenced
by stock option agreements setting forth the total number of shares subject to
the Stock Option, the option price, the term of the Stock Option, and such other
terms and provisions as are approved by the Committee, but, except to the extent
permitted herein, are not inconsistent with the Plan. In the case of an
Incentive Stock Option, the stock option agreement shall also include provisions
that may be necessary to assure that the option is an incentive stock option
under the Code. The Company shall execute stock option agreements upon
instructions from the Committee.

         5.2 OPTION PRICE. The option price for a Nonqualified Stock Option
shall be determined by the Committee and shall be an amount not less than 85% of
the fair market value per share of the Common Stock on the Date of Grant. The
option price for an Incentive Stock Option shall be determined by the Committee
and shall be an amount not less than 100% of the fair market value per share of
the Common Stock on the Date of Grant; the Committee shall determine the fair
market value of the Common Stock on the Date of Grant, and shall set forth the
determination in its minutes, using any reasonable valuation method.
Notwithstanding anything to the contrary in this Section 5.2, the exercise price
of each Stock Option granted pursuant to the Plan shall not be less than the par
value per share of the Common Stock.

         5.3 OPTION PERIOD. The option period will begin and terminate on the
respective dates specified by the Committee, but may not terminate later than
ten years from the Date of Grant. However, if a Participant owns or is deemed to
own (by reason of the attribution rules of Section 424(d) of the Code) more than
10% of the combined voting power of all classes of stock of the Company (or any
Subsidiary of the Company) and an Incentive Stock Option is granted to such
employee, the term of such Incentive Stock Option (to the extent required by the
Code at the time of grant) shall be no more than five years from the Date of
Grant. No Stock Option granted under the Plan may be exercised at any time after
its term. The Committee may provide for the exercise of Stock Options in
installments and upon such terms, conditions and restrictions as it may
determine.

                                       4

<PAGE>   5


         5.4 STOCK OWNERSHIP LIMITATION.  No Incentive Stock Option may be 
granted to an employee who owns more than 10% of the total combined voting power
of all classes of stock of the Company or its Subsidiaries.  This limitation 
will not apply if the option price is at least 110% of the fair market value of 
the Common Stock on the Date of Grant and the option is not exercisable more 
than five years from the Date of Grant.

         5.5 LIMITATION ON EXERCISES OF SHARES SUBJECT TO INCENTIVE STOCK 
OPTIONS.  To the extent required by the Code for incentive stock options, the 
exercise of Incentive Stock Options granted under the Plan shall be subject to 
the $100,000 calendar year limit as set forth in Section 422(d) of the Code.

         5.6 TERMINATION OF EMPLOYMENT. In the event a Participant shall cease
to be employed by the Company, such Participant's Stock Options may be exercised
by the Participant for a period of ninety (90) days after the Participant's
termination of employment or until expiration of the Stock Option period (if
sooner) to the extent of the shares with respect to which such Stock Options
could have been exercised by the Participant on the date of termination, and
thereafter to the extent not so exercised, such Stock Options shall terminate.
In addition:

         (a) Death. In the event of death while employed, the Stock Option may
         be exercised, for a period of ninety (90) days after the Participant's
         death or until expiration of the Stock Option period (if sooner), to
         the extent of the shares with respect to which the Stock Option could
         have been exercised by the Participant on the date of the Participant's
         death, by the Participant's estate or personal representative, or by
         the person who acquired the right to exercise the Stock Option by
         bequest or inheritance or by reason of the Participant's death; and

         (b) Disability.  In the event of termination of employment as the 
         result of a total and permanent disability (as defined in Section 22(e)
         of the Code), the Stock Option may be exercised by the Participant or 
         his guardian for a period of ninety (90) days after such termination or
         until expiration of the Stock Option period (if sooner), to the extent
         of the shares with respect to which the Stock Option could have been 
         exercised by the Participant on the date of such termination.

Notwithstanding the foregoing, individual grants of Stock Options under the Plan
may provide, pursuant to the terms of the particular stock option agreement,
more restrictive terms than those contained in this Plan concerning any exercise
of such Stock Options with respect to any termination of employment by the
Participant.

         5.7 PAYMENT. Full payment for shares purchased upon exercise of a Stock
Option shall be made in cash, or, provided that the particular stock option
agreement so provides, by the Participant's delivery to the Company of shares of
Common Stock which have a fair market value equal to the option price (or in any
combination of cash and shares of Common Stock having an aggregate fair market
value equal to the option price). No shares may be issued until full payment of
the purchase price therefor has been made, and a Participant will have none of
the rights of a stockholder until shares are issued to him.

                                       5

<PAGE>   6

         5.8 EXERCISE OF STOCK OPTION. Stock Options granted under the Plan may
be exercised during the option period, at such times and in such amounts, in
accordance with the terms and conditions and subject to such restrictions as are
set forth herein and in the applicable stock option agreements; provided,
however, that Stock Options shall not be exercisable at any time during the six
month period which begins on the Date of Grant. Except as otherwise contained
herein (see Section 12.7 hereof), Stock Options may not be exercised, nor may
shares be issued pursuant to a Stock Option (i) until the Plan has been approved
by the stockholders of the Company, if necessary to comply with Rule 16b-3
promulgated under the 1934 Act or with the applicable rules or regulations of
any stock exchange or inter-dealer quotation system on which the Common Stock is
listed or quoted or (ii) if any necessary listing of the shares on a stock
exchange or any registration under state or federal securities laws required
under the circumstances has not been accomplished.

         5.9 NON-ASSIGNABILITY. A Stock Option granted to a Participant may not
be transferred or assigned, other than (i) by will or the laws of descent and
distribution or (ii) pursuant to the terms of a qualified domestic relations
order (as defined in Section 401(a)(13) of the Code or Section 206(d)(3) of the
Employee Retirement Income Security Act of 1974, as amended), provided, that in
the case of an Incentive Stock Option, such transfer or assignment may occur
only to the extent it will not result in disqualifying such option as an
incentive stock option under Section 422 of the Code, or any successor
provision. Subject to the foregoing, during a Participant's lifetime, Stock
Options granted to a Participant may be exercised only by the Participant or,
provided the particular stock option agreement so provides, by the Participant's
guardian or legal representative.

         5.10 DISQUALIFYING DISPOSITION. If stock acquired upon exercise of an
Incentive Stock Option is disposed of by a Participant prior to the expiration
of either two years from the Date of Grant of such option or one year from the
transfer of shares to the Participant pursuant to the exercise of such option,
or in any other disqualifying disposition within the meaning of Section 422 of
the Code, such Participant shall notify the Company in writing of the date and
terms of such disposition. A disqualifying disposition by a Participant shall
not affect the status of any other option granted under the Plan as an incentive
stock option within the meaning of Section 422 of the Code.

                                   ARTICLE VI
                           AMENDMENT OR DISCONTINUANCE

         The Board may at any time, without the consent of the Participants, 
alter, amend, revise, suspend, or discontinue the Plan, provided that such
action shall not, without obtaining the approval of the stockholders of the
Company, (i) materially increase the benefits accruing to Participants under the
Plan, (ii) materially increase the number of securities which may be issued
under the Plan, or (iii) materially modify the requirements as to eligibility
for participation in the Plan. Subject to the foregoing limitations, the Board
may amend the Plan or modify the agreements evidencing same in order to comply
with any exemption from the operation of Section 16(b) of the 1934 Act. The
Committee may also substitute new Stock Options for 

                                       6

<PAGE>   7

previously granted Stock Options, including previously granted Stock Options
having higher exercise prices.

                                   ARTICLE VII
                               EFFECT OF THE PLAN

         Neither the adoption of this Plan nor any action of the Board or the
Committee shall be deemed to give any officer or employee any right to be
granted a Stock Option to purchase or receive Common Stock of the Company or any
other rights except as may be evidenced by a stock option agreement, or any
amendment thereto, duly authorized by the Committee and executed on behalf of
the Company and then only to the extent and upon the terms and conditions
expressly set forth therein.

                                  ARTICLE VIII
                                      TERM

         Unless sooner terminated by action of the Board, the Plan will 
terminate on the 3rd day of March, 1997.  Stock Options under the Plan may not 
be granted after that date, but Stock Options granted before that date will 
continue to be effective in accordance with their terms and conditions.

                                   ARTICLE IX
                               CAPITAL ADJUSTMENTS

         If at any time while the Plan is in effect or unexercised Stock Options
are outstanding there shall be any increase or decrease in the number of issued
and outstanding shares of Common Stock through the declaration of a stock
dividend or through any recapitalization resulting in a stock split-up,
combination, or exchange of shares of Common Stock, then and in such event:

                  (i)      An appropriate adjustment shall be made in the 
         maximum number of shares of Common Stock then subject to being awarded 
         under grants pursuant to the Plan, to the end that the same proportion 
         of the Company's issued and outstanding shares of Common Stock shall 
         continue to be subject to being so awarded; and

                  (ii)     Appropriate adjustments shall be made in the number 
         of shares of Common Stock and the exercise price per share thereof then
         subject to purchase pursuant to each such Stock Option previously 
         granted and unexercised, to the end that the same proportion of the 
         Company's issued and outstanding shares of Common Stock in each 
         instance shall remain subject to purchase at the same aggregate 
         exercise price.

         Any fractional shares resulting from any adjustment made pursuant to
this Article IX shall be eliminated for the purposes of such adjustment. Except
as otherwise expressly provided herein, the issuance by the Company of shares of
its capital stock of any class, or securities convertible into shares of capital
stock of any class, either in connection with direct sale or upon 

                                       7

<PAGE>   8

the exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number of or exercise price of shares of Common Stock then
subject to outstanding Stock Options granted under the Plan.

                                    ARTICLE X
                   RECAPITALIZATION, MERGER AND CONSOLIDATION

                  (a) The existence of this Plan and Stock Options granted
         hereunder shall not affect in any way the right or power of the Company
         or its stockholders to make or authorize any or all adjustments,
         recapitalizations, reorganizations or other changes in the Company's
         capital structure or its business, or any merger or consolidation of
         the Company, or any issue of bonds, debentures, preferred or prior
         preference stocks ranking prior to or otherwise affecting the Common
         Stock or the rights thereof (or any rights, options or warrants to
         purchase same), or the dissolution or liquidation of the Company, or
         any sale or transfer of all or any part of its assets or business, or
         any other corporate act or proceeding, whether of a similar character
         or otherwise.

                  (b) Subject to any required action by the stockholders, if the
         Company shall be the surviving or resulting corporation in any merger 
         or consolidation, any outstanding Stock Option granted hereunder shall 
         pertain to and apply to the securities or rights (including cash, 
         property or assets) to which a holder of the number of shares of Common
         Stock subject to the Stock Option would have been entitled.

                  (c) In the event of any merger or consolidation pursuant to
         which the Company is not the surviving or resulting corporation, there
         shall be substituted for each share of Common Stock subject to the
         unexercised portions of such outstanding Stock Option that number of
         shares of each class of stock or other securities or that amount of
         cash, property or assets of the surviving or consolidated company which
         were distributed or distributable to the stockholders of the Company in
         respect of each share of Common Stock held by them, such outstanding
         Stock Options to be thereafter exercisable for such stock, securities,
         cash or property in accordance with their terms. Notwithstanding the
         foregoing, however, all such Stock Options may be cancelled by the
         Board as of the effective date of any such reorganization, merger or
         consolidation, or of any proposed sale of substantially all of the
         assets of the Company, or of any dissolution or liquidation of the
         Company, by giving notice to each holder thereof or his personal
         representative of its intention to do so and by permitting the purchase
         during the thirty (30) day period next preceding such effective date of
         any or all of the shares subject to such outstanding Stock Options,
         including shares as to which such Stock Option would not otherwise be
         exercisable.

                  (d) In the event of a Change in Control of the Company, then, 
         notwithstanding any other provision in the Plan to the contrary, all 
         unmatured installments of Stock Options outstanding shall thereupon
         automatically be accelerated and exercisable in full.

                                       8

<PAGE>   9

                  (e) In case the Company shall, at any time while any Stock
         Option under this Plan shall be in force and remain unexpired, (i) sell
         all or substantially all of its property, or (ii) dissolve, liquidate,
         or wind up its affairs, then each Participant may thereafter receive
         upon exercise hereof (in lieu of each share of Common Stock of the
         Company which such Participant would have been entitled to receive) the
         same kind and amount of any securities or assets as may be issuable,
         distributable or payable upon any such sale, dissolution, liquidation,
         or winding up with respect to each share of Common Stock of the
         Company. In the event that the Company shall, at any time prior to the
         expiration of any Stock Option make any partial distribution of its
         assets in the nature of a partial liquidation, whether payable in cash
         or in kind (but excluding the distribution of a cash dividend payable
         out of retained earnings or earned surplus and designated as such),
         then in such event the exercise prices than in effect with respect to
         each option shall be reduced, as of the payment date of such
         distribution, in proportion to the percentage reduction in the tangible
         book value of the shares of the Company's Common Stock (determined in
         accordance with generally accepted accounting principles) resulting by
         reason of such distribution; provided, that in no event shall any
         adjustment of exercise prices in accordance with the terms of the Plan
         result in any exercise prices being reduced below the par value per
         share of the Common Stock.

                  (f) Upon the occurrence of each event requiring an adjustment
         of the exercise price and/or the number of shares purchasable pursuant
         to Stock Options granted pursuant to the terms of this Plan, the
         Company shall mail forthwith to each Participant a copy of its
         computation of such adjustment which shall be conclusive and shall be
         binding upon each such Participant, except as to any Participant who
         contests such computation by written notice to the Company within
         thirty (30) days after receipt thereof by such Participant.

                                   ARTICLE XI
     OPTIONS IN SUBSTITUTION FOR STOCK OPTIONS GRANTED BY OTHER CORPORATIONS

         Stock Options may be granted under the Plan from time to time in
substitution for such stock options held by employees of a corporation who
become or are about to become employees of the Company or a Subsidiary as the
result of a merger or consolidation of the employing corporation with the
Company or a Subsidiary or the acquisition by either of the foregoing of stock
of the employing corporation as the result of which it becomes a Subsidiary. The
terms and conditions of the substitute options so granted may vary from the
terms and conditions set forth in this Plan to such extent as the Committee at
the time of grant may deem appropriate to conform, in whole or in part, to the
provisions of the options in substitution for which they are granted.

                                   ARTICLE XII
                            MISCELLANEOUS PROVISIONS

         12.1     INVESTMENT INTENT.  The Company may require that there be 
presented to and filed with it by any Participant(s) under the Plan, such 
evidence as it may deem necessary to establish 

                                       9

<PAGE>   10

that the Stock Options granted or the shares of Common Stock to be purchased or
transferred are being acquired for investment and not with a view to their
distribution.

         12.2     ALLOTMENT OF SHARES.  The Committee shall determine the number
of shares of Common Stock to be offered from time to time by grant of Stock 
Options to Participants under the Plan.  The grant of a Stock Option to a 
Participant shall not be deemed either to entitle the Participant to, or to 
disqualify the Participant from, participation in any other grant of Stock 
Options under the Plan.

         12.3     NO RIGHT TO CONTINUE EMPLOYMENT.  Nothing in the Plan or in 
any Stock Option confers upon any employee the right to continue in the employ 
of the Company or interferes with or restricts in any way the right of the 
Company to discharge any employee at any time (subject to any contract rights 
of such employee).

         12.4     STOCKHOLDERS' RIGHTS.  The holder of a Stock Option shall have
none of the rights or privileges of a stockholder except with respect to shares 
which have been actually issued.

         12.5     TAX REQUIREMENTS. Any employee who exercises any Stock Option
shall be required to pay the Company the amount of all taxes which the Company
is required to withhold as a result of the exercise of the Stock Option. With
respect to an Incentive Stock Option, in the event of a subsequent disqualifying
disposition of Common Stock within the meaning of Section 422 of the Code, such
payment of taxes may be made in cash, by check or through the delivery of shares
of Common Stock which the employee then owns, which shares have an aggregate
fair market value equal to the required withholding payment, or any combination
thereof. With respect to the exercise of a Nonqualified Stock Option, the
Participant's obligation to pay such taxes may be satisfied by the following, or
by any combination thereof: (i) the delivery of cash to the Company in an amount
necessary to satisfy the required tax withholding obligation of the Company
and/or (ii) the actual delivery by the exercising Participant to the Company of
shares of Common Stock which the Participant owns and/or the Company's
withholding of a number of shares to be issued upon the exercise of the Stock
Option, which shares so delivered or withheld have an aggregate fair market
value which equals or exceeds (if necessary to avoid the issuance of fractional
shares) the required tax withholding payment. Any such withholding payments with
respect to the exercise of a Nonqualified Stock Option made by a Participant in
cash or by actual delivery of shares of Common Stock shall be required to be
made within thirty (30) days after the delivery to the Participant of any
certificate representing the shares of Common Stock acquired upon exercise of
the Stock Option.

         12.6     INDEMNIFICATION OF BOARD AND COMMITTEE. No member of the Board
or the Committee, nor any officer or employee of the Company acting on behalf of
the Board or the Committee, shall be personally liable for any action,
determination, or interpretation taken or made in good faith with respect to the
Plan, and all members of the Board or the Committee and each and any officer or
employee of the Company acting on their behalf shall, to the extent permitted by
law, be fully indemnified and protected by the Company in respect of any such
action, determination or interpretation.

                                       10

<PAGE>   11

         12.7     AMENDMENT AND RESTATEMENT OF PRIOR PLAN. This Plan is intended
to amend and restate the Company's Nonqualified Stock Option Plan approved and
adopted by the Board on December 14, 1988, which, in turn, memorialized the
Company's informal plan or program in effect since March 3, 1987 to provide
employees with an opportunity to obtain an equity interest in the Company in
order to motivate employment performance, encourage retention of qualified
employees and attract highly qualified personnel, by the grant of nonqualified
stock options to purchase shares of Common Stock of the Company. The Plan was
further amended on May 7, 1991 by action of the Board in order to conform the
plan's provisions to the amended rules promulgated by the Securities and
Exchange Commission under Section 16(b) of the 1934 Act. The Plan was amended on
November 5, 1992 by action of the Board to, among other things, amend Section
12.5. The Plan was amended on May 13, 1997 by action of the Board to further
amend Section 12.5.

                                  ARTICLE XIII
                                 EFFECTIVE DATE

         The effective date of the Plan shall be March 6, 1990, that is, the
date on which it was approved and adopted by the Board (although it amends and
restates the Company's Nonqualified Stock Option Plan as set forth in Section
12.7 hereof).

         IN WITNESS WHEREOF, the Company has caused this instrument to be
executed effective as of the 13th day of May 1997, by its Chief Executive
Officer pursuant to prior action taken by the Board.


                                           IMCO RECYCLING INC.


                                           By:
                                               ---------------------------------
                                                 Don V. Ingram
                                                 Chief Executive Officer


Attest:


-----------------------------------
Paul V. Dufour
Secretary


                                       11