SECTION 1.           DEFINITIONS

1.1       “AUDIT” includes any audit, assessment of Taxes, other examination by any Tax Authority, proceeding, or appeal of such proceeding relating to Taxes, whether administrative or judicial.

1.2       “COMBINED GROUP” means a group of corporations or other entities that files a Combined Return.

1.3       “COMBINED RETURN” means any Tax Return with respect to Non-Federal Taxes filed on a consolidated, combined (including nexus combination, worldwide combination, domestic combination, line of business combination or any other form of combination) or unitary basis wherein one or more members of the Mueller Group join in the filing of a Tax Return with Walter or a Walter Affiliate that is not also a member of the Mueller Group.

1.4       “CONSOLIDATED GROUP” means the affiliated group of corporations within the meaning of Section 1504(a) of the Code of which Walter is the common parent and which includes the Mueller Group.

1.5       “CONSOLIDATED RETURN” means any Tax Return with respect to Federal Income Taxes filed by the Consolidated Group pursuant to Section 1501 of the Code.

1.6       “DECONSOLIDATION” means any event pursuant to which Mueller and the Mueller Group cease to be includible in either the Consolidated Group or any Combined Group, as the context requires.

1.7       “DECONSOLIDATION DATE” means the close of business on the day on which a Deconsolidation occurs. Unless otherwise required by the relevant Tax Authority or a court of competent jurisdiction, Walter and Mueller, for itself and the Mueller Group, agree to file all Tax Returns, and to take all other actions, relating to Federal Income Taxes or Non-Federal Combined Taxes in a manner consistent with the position that Mueller and the Mueller Group are includible in the Consolidated Group and any applicable Combined Group for all days from the date hereof through and including a Deconsolidation Date.

1.8       “DISTRIBUTION” means any distribution by Walter of the issued and outstanding shares of Mueller stock that Walter holds at such time in a transaction intended to qualify as a tax-free distribution under Section 355 of the Code.

1.9       “DISTRIBUTION TAXES” means any (i) Taxes imposed on, or increase in Taxes incurred by, Walter or any Walter Affiliate and (ii) any Taxes of a Walter shareholder (or former Walter shareholder) that are required to be paid or reimbursed by Walter or any Walter Affiliate pursuant to a legal determination, resulting from, or arising in connection with, the failure of a Distribution to qualify as a tax-free transaction under Section 355 of the Code (including, without limitation, any Tax resulting from the application of Section 355(d) or Section 355(e) of the Code to a Distribution) or corresponding provisions of the laws of any other jurisdictions.  Any Tax referred to in the immediately preceding sentence shall be determined using the highest applicable statutory Tax rate for the relevant taxable period (or portion thereof).

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1.10     “ESTIMATED TAX INSTALLMENT DATE” means the installment due dates prescribed in Section 6655(c) of the Code (presently April 15, June 15, September 15 and December 15).

1.11     “FEDERAL INCOME TAX” or “FEDERAL INCOME TAXES” means any tax imposed under Subtitle A of the Code (including the taxes imposed by Sections 11, 55, 59A, and 1201(a) of the Code), including any interest, additions to Tax, or penalties applicable thereto, and any other income based United States Federal Tax which is hereinafter imposed upon corporations.

1.12     “FEDERAL TAX” means any Tax imposed under the Code or otherwise under United States federal Tax law.

1.13     “FINAL DETERMINATION” means (a) the final resolution of any Tax (or other matter) for a taxable period, including any related interest or penalties, that, under applicable law, is not subject to further appeal, review or modification through proceedings or otherwise, including (1) by the expiration of a statute of limitations (giving effect to any extension, waiver or mitigation thereof) or a period for the filing of claims for refunds, amended returns, appeals from adverse determinations, or recovering any refund (including by offset), (2) by a decision, judgment, decree, or other order by a court of competent jurisdiction, which has become final and unappealable, (3) by a closing agreement or an accepted offer in compromise under Section 7121 or 7122 of the Code, or comparable agreements under laws of other jurisdictions, (4) by execution of an IRS Form 870-AD, or by a comparable form under the laws of other jurisdictions (excluding, however, any such form that reserves (whether by its terms or by operation of law) the right of the taxpayer to file a claim for refund and/or the right of the Tax Authority to assert a further deficiency), or (5) by any allowance of a refund or credit, but only after the expiration of all periods during which such refund or credit may be recovered (including by way of offset) or (b) the payment of Tax by any member of the Consolidated Group or Combined Group with respect to any item disallowed or adjusted by a Tax Authority provided that Walter determines that no action should be taken to recoup such payment.

1.14     “IRS” means the Internal Revenue Service.

1.15     “MARKET VALUATION” means as of the first business day immediately following the date on which the Distribution is effected (i) with respect to Mueller, the fair market value of all of its issued and outstanding stock (measured using the mean of the high and low of the public trading price as published in The Wall Street Journal) as of such date, or (ii) with respect to Walter, the fair market value of all of its issued and outstanding stock (measured using the mean of the high and low of the public trading price as published in The Wall Street Journal) as of such date.

1.16     “MUELLER AFFILIATE” means any corporation or other entity, including any entity that is a disregarded entity for federal income tax purposes, directly or indirectly “controlled” by Mueller where “control” means the ownership of fifty percent (50%) or more of the ownership interests of such corporation or other entity (by vote or value) or the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such corporation or other entity.

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1.17     “MUELLER BUSINESS” means the business and operations conducted by Mueller and its Affiliates as such business and operations will continue after the date of the IPO.

1.18     “MUELLER GROUP” means the affiliated group of corporations, including any entity that is a disregarded entity for federal income tax purposes, as defined in Section 1504(a) of the Code, or similar group of entities as defined under similar laws of other jurisdictions, of which Mueller would be the common parent if it were not a subsidiary of Walter, and any corporation or other entity, including any entity that is a disregarded entity for federal income tax purposes, which may be or become a member of such group from time to time.

1.19     “MUELLER GROUP COMBINED TAX LIABILITY” means, with respect to any taxable year, the Mueller Group’s liability for Non-Federal Combined Taxes as determined under Section 3.6 of this Agreement.

1.20     “MUELLER GROUP FEDERAL INCOME TAX LIABILITY” means, with respect to any taxable year, the Mueller Group’s liability for Federal Income Taxes as determined under Section 3.5 of this Agreement.

1.21     “NON-FEDERAL COMBINED TAXES” means any Non-Federal Taxes with respect to which a Combined Return is filed.

1.22     “NON-FEDERAL SEPARATE TAXES” means any Non-Federal Taxes that are not Non-Federal Combined Taxes.

1.23     “NON-FEDERAL TAXES” means any Tax other than a Federal Tax.

1.24     “OFFICER’S CERTIFICATE” means a letter executed by an officer of Walter or Mueller and provided to Tax Counsel as a condition for the completion of a Tax Opinion or Supplemental Tax Opinion.

1.25     “POST-DECONSOLIDATION PERIOD” means a taxable period beginning after the applicable Deconsolidation Date.

1.26     “PRE-DECONSOLIDATION PERIOD” means any taxable period beginning  on or prior to the applicable Deconsolidation Date.

1.27     “PRO FORMA MUELLER GROUP COMBINED RETURN” means a pro forma non-federal combined tax return or other schedule prepared pursuant to Section 3.6 of this Agreement.

1.28     “PRO FORMA MUELLER GROUP CONSOLIDATED RETURN” means a pro forma consolidated federal income tax return prepared pursuant to Section 3.5(b) of this Agreement.

1.29     “REDETERMINATION AMOUNT” means, with respect to any taxable year, the amount determined under Section 3.10 of this Agreement.

1.30     “RULING” means (i) any private letter ruling issued by the IRS in connection with a Distribution in response to a request for such a private letter ruling filed by Walter (or any Walter Affiliate) prior to the date of a Distribution, and (ii) any similar ruling issued

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by any other Tax Authority addressing the application of a provision of the laws of another jurisdiction to a Distribution.

1.31     “RULING DOCUMENTS” means (i) the request for a Ruling filed with the IRS, together with any supplemental filings or other materials subsequently submitted on behalf of Walter, its Affiliates and shareholders to the IRS, or on behalf of Mueller, its Affiliates and shareholders to the IRS the appendices and exhibits thereto, and any Ruling issued by the IRS to Walter (or any Walter Affiliate) or Mueller (or any Mueller Affiliate) in connection with a Distribution and (ii) any similar filings submitted to, or rulings issued by, any other Tax Authority in connection with a Distribution.

1.32     “SUPPLEMENTAL RULING” means (i) any ruling (other than the Ruling) issued by the IRS in connection with a Distribution, and (ii) any similar ruling issued by any other Tax Authority addressing the application of a provision of the laws of another jurisdiction to a Distribution.

1.33     “SUPPLEMENTAL RULING DOCUMENTS” means (i) the request for a Supplemental Ruling, together with any supplemental filings or other materials subsequently submitted, the appendices and exhibits thereto, and any Supplemental Rulings issued by the IRS in connection with a Distribution and (ii) any similar filings submitted to, or rulings issued by, any other Tax Authority in connection with a Distribution.

1.34     “SUPPLEMENTAL TAX OPINION” has the meaning set forth in Section 4.2(c) of this Agreement.

1.35     “TAX ASSET” means any net operating loss, net capital loss, investment tax credit, foreign tax credit, charitable deduction or any other deduction, credit or tax attribute which could reduce Taxes (including without limitation deductions and credits related to alternative minimum taxes).

1.36     “TAX AUTHORITY” includes the IRS and any state, local, or other governmental authority responsible for the administration of any Taxes.

1.37     “TAX COUNSEL” means a nationally recognized law firm or accounting firm selected by Walter to provide a Tax Opinion or a Supplemental Tax Opinion.

1.38     “TAX” or “TAXES” means any charges, fees, levies, imposts, duties, or other assessments of a similar nature, including without limitation, income, alternative or add-on minimum, gross receipts, excise, employment, sales, use, transfer, license, payroll, franchise, severance, stamp, occupation, windfall profits, withholding, Social Security, unemployment, disability, ad valorem, estimated, highway use, commercial rent, capital stock, paid up capital, recording, registration, property, real property gains, value added, business license, custom duties, or other tax or governmental fee of any kind whatsoever, imposed or required to be withheld by any Tax Authority including any interest, additions to Tax, or penalties applicable thereto.

1.39     “TAX RETURN” OR “TAX RETURNS” means any return, declaration, statement, report, schedule, certificate, form, information return or any other document (and any related or supporting information) including an amended tax return required to be supplied to, or filed with, a Tax Authority with respect to Taxes.

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1.40     “TAX OPINION” means an opinion issued by Tax Counsel as one of the conditions to completing a Distribution addressing certain United States federal income tax consequences of a Distribution under Section 355 of the Code.

1.41     “WALTER AFFILIATE” means any corporation or other entity, including any entity that is disregarded for federal income tax purposes, directly or indirectly “controlled” by Walter where “control” means the ownership of fifty percent (50%) or more of the ownership interests of such corporation or other entity (by vote or value) or the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such corporation or other entity, but at all times excluding Mueller or any Mueller Affiliate.

1.42     “WALTER BUSINESS” means all of the businesses and operations conducted by Walter and its Affiliates, excluding the Mueller Business, at any time, whether prior to, or after the date of the IPO.

SECTION 2.           PREPARATION AND FILING OF TAX RETURNS

2.1       IN GENERAL .  (a)  Walter shall have the sole and exclusive responsibility for the preparation and filing of any Consolidated Return or Combined Return.

(b)       Mueller shall, subject to Section 2.2 of this Agreement, be responsible for preparing and filing all Tax Returns of Mueller and the Mueller Affiliates other than those described in Section 2.1(a) of this Agreement.

2.2       PREPARATION AND FILING OF RETURNS.  (a) All Tax Returns filed after the date of this Agreement by Walter, any Walter Affiliate, Mueller, or any Mueller Affiliate shall (1) be prepared in a manner that is consistent with Section 4 of this Agreement and the Code, and (2) filed on a timely basis (taking into account applicable extensions) by the party responsible for such filing under Section 2.1 of this Agreement.

(b)       In its sole discretion, Walter shall have the exclusive right with respect to any Consolidated Return or Combined Return (a) to determine (1) the manner in which such Tax Return shall be prepared and filed, including, without limitation, the manner in which any item of income, gain, loss, deduction or credit shall be reported, (2) whether any extensions may be requested, (3) the elections that will be made by any member of the Consolidated Group or applicable Combined Group, and (4) whether any amended Tax Returns should be filed, (b) to control, contest, and represent the interests of the Consolidated Group and  any Combined Group in any Audit and to resolve, settle, or agree to any adjustment or deficiency proposed, asserted or assessed as a result of any Audit, (c) to file, prosecute, compromise or settle any claim for refund, and (d) to determine whether any refunds, to which the Consolidated Group or applicable Combined Group may be entitled, shall be paid by way of refund or credited against the Tax liability of the Consolidated Group or applicable Combined Group. Mueller, for itself and its subsidiaries, hereby irrevocably appoints Walter as its agent and attorney-in-fact to take such action (including the execution of documents) as Walter may deem appropriate to effect the foregoing.

2.3       FURNISHING INFORMATION . Mueller (or the applicable Mueller Affiliate) shall (a) furnish to Walter in a timely manner such information and documents as Walter may reasonably request for purposes of (1) preparing any original or amended Consolidated Return or Combined Return, (2) contesting or defending any Audit relating to a Consolidated

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Return or a Combined Return, and (3) making any determination or computation necessary or appropriate under this Agreement, (b) cooperate in any Audit of any Consolidated Return or Combined Return, (c) retain and provide on demand books, records, documentation or other information relating to any tax return until the later of (1) the expiration of the applicable statute of limitations (giving effect to any extension, waiver, or mitigation thereof) and (2) in the event any claim is made under this Agreement for which such information is relevant, until a Final Determination with respect to such claim, and (d) take such action as Walter may deem appropriate in connection therewith. Walter shall provide Mueller (or the applicable Mueller Affiliate) any assistance reasonably required in providing any information requested pursuant to this Section 2.3.

2.4       EXPENSES .  Mueller shall reimburse Walter for any outside legal and accounting expenses incurred by Walter in the course of the conduct of any Audit regarding the Tax liability of the Consolidated Group or any Combined Group, and for any other expense incurred by Walter in the course of any litigation relating thereto, to the extent such costs are reasonably attributable to Mueller or any Mueller Affiliate and provided Walter has conferred with Mueller as to the por