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EXHIBIT 10.17
EMPLOYMENT AGREEMENT
AGREEMENT, made
and entered into as of the 1st day of June, 2003, by and
between Metallurg, Inc., a Delaware
corporation (together with its successors
and assigns permitted under this Agreement,
the "Company"), and Charles H.
Entrekin (the "Executive").
W I T N E S S E T H :
WHEREAS, the
Company desires to enter into an employment agreement (the
"Agreement") embodying the terms of
employment between the Executive and the
Company; and
WHEREAS, the
Executive desires to enter into the Agreement and to accept
such employment, subject to the terms and
provisions of the Agreement;
NOW, THEREFORE,
in consideration of the premises and mutual covenants
contained herein and for other good and
valuable consideration, the receipt of
which is mutually acknowledged, the Company
and the Executive (individually a
"Party" and together the "Parties") agree
as follows:
1. Definitions.
(a) "Base Salary" shall mean the Executive's base salary in
accordance
with Section 4 below.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Business Day" shall mean any day other than a Saturday, Sunday
or
any other day on which commercial banks in
New York, New York are required or
authorized to be closed.
(d) "Cause" shall mean:
(1) the Executive is
convicted of (or pleads nolo contendere to)
a felony or a crime of moral turpitude, dishonesty, breach
of trust or unethical business conduct involving the
Company;
(2) the Executive
engages in willful misconduct, willful or
gross neglect, fraud, insubordination, misappropriation or
embezzlement to the material and demonstrable detriment of
the Company; or
(3) the Executive
breaches in any material respect the terms and
provisions of this Agreement and fails to cure such breach
within 20 days following written notice from the Company
specifying such breach.
(4) the Executive
declines to accept a transfer of employment to
a senior executive position of similar nature and
compensatory terms with an affiliated company having a
normal place of business within North America.
(e) "COO" shall mean the chief operating officer of the
Company.
(f) "Code" shall mean the Internal Revenue Code of 1986, as
amended
from time to time, including applicable
regulations thereunder.
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EXHIBIT 10.17
(g) "Competitive Activity" shall mean any activity engaged in by
the
Executive, whether as an employee,
principal, sole proprietor, consultant,
agent, officer, director, partner or
shareholder (except as a less than
one-percent shareholder of a publicly
traded company or a less than five-percent
shareholder of a privately held company),
which directly competes with the
Company or any Subsidiary. For this
purpose, an activity which directly competes
with the Company or any Subsidiary shall
mean a business that was being
conducted by the Company or any Subsidiary
during the Term of Employment.
Notwithstanding anything to the contrary in
this Section 1(g), an activity shall
not be deemed to be a Competitive Activity
(x) solely as a result of the
Executive's being employed by or otherwise
associated with a business of which a
unit is in competition with the Company or
any Subsidiary but as to which unit
the Executive does not have direct or
indirect responsibilities for the products
or product lines involved or (y) if the
activity contributes less than 5 percent
of the revenues for the fiscal year in
question of the business by which the
Executive is employed or with which he is
otherwise associated.
(h) "Disability" shall mean a disability as determined under
the
Company's long-term disability plans,
programs and/or arrangements in effect on
the date such disability first occurs.
(i) "Effective Date" shall mean June 1, 2003.
(j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as
amended from time to time, including
applicable regulations thereunder.
(k) "Good Reason" shall mean the occurrence of any of the
following
events:
(1) the material
change of the Executive's authority, duties and
responsibilities, or the assignment to the Executive of
duties materially different from the Executive's position or
positions with the Company;
(2) a reduction in
Base Salary of the Executive;
(3) the failure by the
Company to obtain an agreement in form
and substance reasonably satisfactory to the Executive from
any successor to the business of the Company to assume and
agree to perform this Agreement; or
(4) the Company
breaches in any material respect the terms and
provisions of this Agreement and fails to cure such breach
within 20 days following written notice from the Executive
specifying such breach.
(l) "Subsidiary" of the Company shall mean any corporation of
which
the Company owns, directly or indirectly,
more than 50 percent of the Voting
Stock or any other business entity in which
the Company directly or indirectly
has an ownership interest of more than 50
percent.
(m)
"Term of Employment" shall mean the period specified in Section
2
below.
(n) "Voting Stock" shall mean capital stock of any class or
classes
having general voting power under ordinary
circumstances, in the absence of
contingencies, to elect the directors of a
corporation.
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EXHIBIT 10.17
2. Term of Employment.
The Company hereby employs the Executive, and the Executive
hereby
accepts such employment, for the period
commencing on the Effective Date and
ending on the first anniversary of the
Effective Date (the "Term of
Employment"), subject to earlier
termination of the Term of Employment in
accordance with the terms of the Agreement.
The Term of Employment shall be
automatically renewed for a one-year period
on each anniversary of the Effective
Date thereafter, unless, in each case,
either Party has notified the other Party
in writing in accordance with Section 26
below at least 90 days prior to the
expiration of the then Term of Employment
that he or it does not want the Term
of Employment to so renew.
3. Position, Duties and
Responsibilities.
The Executive, in his initial capacity as Managing Director of
London
& Scandinavian Metallurgical Co Limited
shall faithfully perform for the Company
the duties of said office and shall perform
such other duties of an executive,
managerial or administrative nature as
shall be specified and designated from
time to time by the COO consistent with
such office. The Executive shall devote
substantially all of his business time and
effort to the performance of his
duties hereunder. The Executive, in
carrying out his duties under this
Agreement, shall report to the COO.
Notwithstanding anything in this Section 3
to the contrary, nothing shall preclude the
Executive from:
(1) serving on the
boards of directors of a reasonable number of
other corporations or the boards of a reasonable number of
trade associations and/or charitable organizations;
(2) engaging in
charitable activities and community affairs; and
(3) managing his
personal investments and affairs;
provided, however, that such activities do
not materially interfere with the
proper performance of his duties and
responsibilities hereunder.
4. Base Salary.
During the Term of Employment, the Executive shall be paid an
annual
Base Salary, payable in accordance with the
regular payroll practices of the
Company, of $250,000. The Base Salary may
be increased (but not decreased) at
any time and from time to time by action of
the Board or by any committee
thereof or any individual having authority
to take such action in accordance
with the Company's regular practices. Once
increased, any reference to Base
Salary herein shall be a reference to such
increased amount.
5. Bonus.
During the Term of Employment, in addition to the Base Salary,
for
each fiscal year of the Company ending
during the Term of Employment, the
Executive shall have the opportunity to
receive an annual bonus (an "Annual
Bonus") in an amount of up to 50 percent of
Base Salary, as determined by the
COO, in consultation with the Chairman of
the Board. Payment of Annual Bonus
shall be made at the same time that other
senior-level executives receive their
annual incentive compensation awards.
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EXHIBIT 10.17
6. Housing Allowance
During the term of Employment and for any period of time in which
the
Executive is required to maintain a second
residence outside North America, the
Executive shall be paid an allowance for
housing expenses (including utilities,
etc) equal to his actual out of pocket cost
for the second residence up to a
maximum amount of one thousand British
Pounds per month.
7. [Intentionally omitted]
8. Employee Benefit
Programs.
(a) During the Term of Employment, the Executive, to the extent he
is
eligible, shall be entitled to participate
in those employee pension and welfare
benefit plans, programs and/or arrangements
applicable to the Executive and made
available to the Company's senior-level
executives or to its employees
generally, as such plans, programs and/or
arrangements may be in effect from
time to time, including, without
limitation, pension, profit-sharing, savings,
medical, dental, hospitalization,
short-term disability, long-term disability,
life insurance, accidental death and
dismemberment protection, travel accident
insurance, and other employee pension and
welfare benefit plans, programs and/or
arrangements that may be sponsored by the
Company from time to time.
(b) During the Term of Employment, the Company shall provide
the
Executive with term life insurance with a
death benefit of at least two times
Base Salary. The Company shall pay all
premiums with respect to such life
insurance. Such life insurance may be
provided either through the Company's
group life insurance programs, by an
individual policy, or by a combination of
both group and individual policies.
9. Reimbursement of Business
Expenses.
The Executive is authorized to incur ordinary and reasonable
business
expenses in carrying out his duties and
responsibilities under the Agreement,
and the Company shall reimburse him for all
such ordinary and reasonable
business expenses incurred in connection
with carrying out the business of the
Company, subject to documentation in
accordance with the Company's policy.
10. Perquisites.
(a) During the Term of Employment, the Executive shall be entitled
to
participate in the Company's executive
fringe benefits applicable to the
Company's senior-level executive in
accordance with the terms and conditions of
such arrangements as are in effect from
time to time.
(b) During the Term of Employment, the Company shall provide a car
to
the Executive.
11. Vacation.
The Executive shall be entitled to paid vacation in accordance
with
the Company's vacation policy; provided,
however, that the Executive shall be
entitled to not less than four weeks of
vacation each year.
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EXHIBIT 10.17
12. Termination of Employment.
(a) Termination of Employment Due to Death. In the event of the
Executive's death during the Term of
Employment, the Term of Employment shall
end as of the date of the Executive's death
and his estate and/or beneficiaries,
as the case may be, shall be entitled to
the following:
(1) Base Salary earned
but not paid prior to the date of his
death;
(2) Annual Bonus with
respect to any year prior to the year of
his death which has been earned but not paid;
(3) any amounts
earned, accrued or owing to the Executive but
not yet paid under Section 6, 8, 9, 10 or 11 above; and
(4) other or
additional benefits in accordance with applicable
plans, programs and/or arrangements of the Company.
(b)
Termination of Employment Due to Disability. If the Executive's
employment is terminated due to Disability
during the Term of Employment, either
by the Company or by the Executive, the
Term of Employment shall end as of the
date of the Executive's termination of
employment and the Executive shall be
entitled to the following (but in no event
shall the Executive be entitled to
less than the benefits due him under any
disability program of the Company for
which he becomes eligible):
(1) Base Salary earned
but not paid prior to the date of the
termination of the Executive's employment;
(2) Annual Bonus with
respect to any year prior to the year of
the termination of the Executive's employment which has been
earned but not paid;
(3) an amount equal to
the sum of 50 percent of Base Salary, at
the annual rate in effect on the date of the termination of
the Executive's employment, payable in monthly installments
for a period ending on the first day of the month following
the month in which the Executive attains age 65 or recovers
from his Disability, whichever occurs earlier, less the
amount of any disability benefits provided to the Executive
under the Company's disability program;
(4) any amounts
earned, accrued or owing to the Executive but
not yet paid under Section 6, 8, 9, 10 or 11 above;
(5) continued
participation, as if the Executive were still an
employee, in the Company's medical, dental, hospitalization
and life insurance plans, programs and/or arrangements and
in those other employee plans, programs and/or arrangements
in which he was participating on the date of the termination
of his employment until he attains age 65 or recovers from
his Disability, whichever occurs earlier;
provided, however, that:
(X) if the Executive
is precluded from continuing his
participation in any employee benefit plan, program or
arrangement as provided
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EXHIBIT 10.17
in this Section
12(b)(5), he shall be provided with the
after-tax economic equivalent of the benefits provided
under the plan, program or arrangement in which he is
unable to participate for the period specified in this
Section 12(b)(5); and
(Y) the economic
equivalent of any benefit foregone shall
be deemed to be the lowest cost that would be incurred
by the Executive in obtaining such benefit himself on
an individual basis; and
(6) other or
additional benefits in accordance with applicable
plans, programs and/or arrangements of the Company.
In no event shall a termination of the Executive's employment
for
Disability occur unless the Party
terminating his employment gives written
notice to the other Party in accordance
with Section 26 below.
(c) Termination of Employment by the Company for Cause. A
termination
of the Executive's employment by the
Company for Cause shall not take effect
unless the provisions of this Section 12(c)
are complied with and the Board
issues a written determination that the
Executive's employment should be
terminated for Cause (a
"Determination").
(1) In accordance with
Section 26 below, the COO shall give the
Executive a written notice stating his intention to
terminate the Executive's employment for Cause (the "Cause
Notice"). The Cause Notice shall:
(A) state in detail
the particular act or acts or failure
or failures to act that constitute the grounds on which
the proposed termination of employment for Cause is
based; and
(B) be given within
four months of the COO learning of such
act or acts or failure or failures to a
