EMPLOYMENT AGREEMENT
EXHIBIT 10.6
This EMPLOYMENT AGREEMENT (“Agreement”), is made and entered into as of January 16, 2004, by
and between Xxxxxx X. Xxxxxxx (“Xxxxxxx”) and Metal Management, Inc., a Delaware corporation
(“MTLM”).
NOW, THEREFORE, in consideration of the premises, promises, mutual covenants and mutual
agreements contained herein, Rouster and MTLM hereby agree as follows:
1. Employment.
(a) On the terms and subject to the conditions set forth in this Agreement, MTLM agrees
to employ Rouster as an employee of the following MTLM subsidiaries (the “Subsidiaries”) in
the following positions: President of Metal Management Midwest, Inc., an Illinois
corporation; President of Metal Management Memphis, LLC, a Tennessee limited liability
company; and President of Metal Management Ohio, Inc., an Ohio corporation. Rouster shall
perform such duties and responsibilities as are consistent with such positions and such
other positions as may be assigned to Rouster, from time to time, by MTLM. For as long as
Rouster is so employed, he shall devote his full business time, energy and ability to his
duties, except for incidental attention to the management of his personal affairs; provided,
however, that Rouster shall be permitted to complete promptly after the date of this
Agreement (but in no event more than 30 days after the date of this Agreement) incidental
matters required in the termination of Rouster’s prior employment.
(b) Employee’s duties under this Agreement shall be performed for the Subsidiaries
principally in the Chicago, Illinois area, with periodic trips to MTLM’s operations and
customers and corporate meetings outside of the Chicago area, as may be required.
2. Term. The term of Rouster’s employment with the Subsidiaries under this Agreement
shall commence as of January 16, 2004 (the “Commencement Date”) and shall continue through, and end
as of the close of business on March 31, 2008 (the “Employment Period”); provided, however, that on
March 31, 2008 and each anniversary thereof, the Employment Period shall be automatically extended
for successive one-year periods unless either MTLM or Rouster, as the case may be, notifies the
other not less than 60 days prior to the end of the then current Employment Period of its or his
desire not to extend the Employment Period; provided further that the Employment Period may
terminate sooner upon the occurrence of certain events as described in Sections 5, 6, 7, 8 and 10
of this Agreement. The date on which Rouster’s employment is terminated shall be referred to
herein as the “Termination Date” and such date shall also be the date upon which this Agreement
terminates except as to those terms of this Agreement that extend beyond the term of this Agreement
as provided herein.
3. Compensation.
(a) Base Compensation. The base compensation to be paid to Rouster for his
services under this Agreement shall be not less than $350,000 per year, subject to
applicable withholdings, payable in equal periodic installments in accordance with the
usual payroll practices of MTLM or the Subsidiaries, but no less frequently than monthly,
commencing on the Commencement Date. Rouster’s base compensation shall be subject to annual
review for cost of living and merit factors, with any adjustments approved by the
compensation committee of the Board of MTLM (the “Compensation Committee”). The foregoing
is hereafter referred to as Rouster’s “Base Compensation.”
(b) Bonuses. During the Employment Period, Rouster shall also be eligible to
receive the following:
(i) Signing Bonus. MTLM shall, subject to applicable withholdings, pay
Rouster $250,000 as a signing bonus, such amount to be payable no later than March
16, 2004, in accordance with the usual payroll practices of MTLM.
(ii) Annual Bonus. For the period ending March 31, 2004, and for each
subsequent twelve-month period during the Employment Period ending March 31, Rouster
shall be eligible to receive an annual bonus in accordance with the terms of MTLM’s
annual bonus program as then in effect for MTLM’s senior executives or senior
executives of the Subsidiaries; provided, however, the Compensation Committee may
direct MTLM to pay Rouster an annual bonus that exceeds the annual bonus otherwise
payable under such program. Each annual bonus described in this Section 3(b)(ii)
shall be paid at the time called for under MTLM’s annual bonus program for senior
executives.
(c) Options. Upon execution and delivery of this Agreement by MTLM and
Rouster, Rouster shall be granted the following incentive stock options (“ISOs”) and
non-incentive stock options (“non-ISOs” and, collectively with ISOs, “Options”) to purchase
shares of MTLM Stock pursuant to the terms of the Metal Management, Inc. 2002 Incentive
Stock Plan (the “Plan”): (i) 2,541 shares of MTLM Stock at an exercise price per share equal
to the Fair Market Value, as defined in the Plan, on the date that the Compensation
Committee approves the grant (such price, the “Grant Date Exercise Share Price”), all such
stock options to be ISOs; (ii) 22,459 shares of MTLM Stock at an exercise price per share
equal to the Grant Date Exercise Share Price, all such stock options to be non-ISOs; (iii)
25,000 shares of MTLM Stock at an exercise price per share of $52.50, all such stock options
to be non-ISOs; and (iv) 25,000 shares of MTLM Stock at an exercise price per share of
$70.00, all such stock options to be non-ISOs. Rouster’s interest in one-third (1/3) of
each grant of ISOs and non-ISOs set forth in clauses (i), (ii), (iii), and (iv) of this
Section 3(c) shall vest on March 31, 2005, provided Rouster is still employed by the
Subsidiaries on such date, and his interest in an additional one-third (1/3) of each such
ISOs and non-ISOs set forth in clauses (i), (ii), (iii), and (iv) of this Section 3(c) shall
vest on each of the next two subsequent anniversaries of such date provided Rouster is still
employed by MTLM on such anniversary date. All the terms and conditions to such grants
shall be set forth for Rouster in certificates in accordance with the terms of the Plan.
Except as otherwise set forth in this Section 3(c), all or part of the ISOs and non-ISOs
that have vested by operation of this Agreement or otherwise shall be exercisable, at the
election of Rouster, at any time on or after the date hereof and on or prior to the tenth
anniversary of the date the Options are granted; provided,
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however, that if the Employment Period terminates for any reason (other than retirement
at or after the age of 65, termination of the Employment Period under Section 5 of this
Agreement, or termination for Cause (as defined below)), Rouster shall have three months
after the date of such termination in which to exercise such Options (but in no event shall
the Options be exercisable after the tenth anniversary of the date the Options are granted).
In the case of retirement at or after the age of 65, Rouster shall have (i) one year after
the date of such retirement in which to exercise any non-ISOs and (ii) three months after
the date of such retirement in which to exercise any ISOs, but in no event shall the
non-ISOs or the ISOs be exercisable after the tenth anniversary of the date the Options are
granted. In the case of termination of the Employment Period under Section 5 of this
Agreement, Rouster (or his estate) shall have (i) two years after the date of such
termination in which to exercise any non-ISOs, and (ii) one year after the date of such
termination in which to exercise any ISOs, but in no event shall the non-ISOs or the ISOs be
exercisable after the tenth anniversary of the date the Options are granted. If Rouster is
terminated for Cause (as defined below), the Options will expire immediately and
automatically at the time of such termination.
(d) Restricted Stock. Upon execution and delivery of the this Agreement by
MTLM and Rouster, Rouster shall be granted 9,318 shares of restricted common stock, $0.01
par value per share (the “MTLM Restricted Stock”) pursuant to the terms of the Plan. Except
as otherwise provided in Section 8(b) of this Agreement, elsewhere in this Agreement, or the
Plan, Rouster’s interest in one-third (1/3) of such shares of common stock shall become
non-forfeitable on March 31, 2005, provided Rouster is still employed by the Subsidiaries on
such date, and his interest in an additional one-third (1/3) of such shares shall become
non-forfeitable on each of the next two subsequent anniversaries of such date provided
Rouster is still employed by the Subsidiaries on such anniversary date. All the terms and
conditions to such grant shall be set forth for Rouster in a certificate in accordance with
the terms of the Plan.
(e) Relocation Expenses. Rouster’s normal and reasonable moving and
transportation expenses to Chicago, Illinois will be paid by MTLM. Moving expenses cover
the transportation of normal household articles from Rouster’s residence in Buffalo, New
York, but do not cover shipping automobiles. Additionally, MTLM will reimburse reasonable
expenses for termination of Rouster’s residential lease in Buffalo, New York, temporary
storage of personal and household belongings, and up to three house hunting trips for
Rouster’s spouse. Rouster will also receive a one-time tax gross-up of all moving expenses
reimbursed by MTLM that are taxed under federal or state tax laws.
4. Fringe Benefits. MTLM shall furnish Rouster with accident, health and life
insurance and reimbursement of all documented reasonable and necessary out-of-pocket expenses
incurred by Rouster on behalf of MTLM by reason of the performance of Rouster’s duties and
responsibilities hereunder. Further, MTLM shall furnish Rouster with all of the additional fringe
benefits made generally available by MTLM to its executive officers and employees or those of its
Subsidiaries recognizing that such fringe benefits may be changed from time to time provided
Rouster shall be deemed immediately eligible for any such fringe benefits to the extent permissible
under the terms of applicable law and the terms of the underlying plans,
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programs and policies. Rouster shall be entitled to take four weeks of paid vacation per
calendar year, and shall be paid on all national and state holidays, during the Employment Period.
Vacation allowances shall not be cumulative from year to year; unused vacation at the end of a
calendar year shall expire. MTLM shall include Rouster as a covered person under MTLM’s and/or the
Subsidiaries’ directors and officers’ insurance policies. MTLM shall furnish Rouster with
appropriate office space, equipment, supplies, and such other facilities and personnel as necessary
or appropriate (de minimis use thereof by Rouster for personal reasons shall not be deemed a breach
of this Agreement). MTLM shall pay Rouster’s dues in such societies or organizations as MTLM deems
appropriate, and shall pay on behalf of Rouster (or reimburse Rouster for) documented reasonable
out-of-pocket expenses incurred by Rouster in attending conventions, seminars, trade shows and
other business meetings and business entertainment and promotional expenses. MTLM shall pay
Rouster an automobile allowance of $1,000.00 per month, subject to applicable withholdings.
5. Severance Benefits in the Case of Termination by Death or Permanent Disability.
If, during the Employment Period, Rouster dies (as confirmed by a certificate of death) or Rouster
is permanently disabled such that, in the opinion of a physician selected by MTLM and Rouster,
Rouster is rendered incapable of performing the services contemplated under this Agreement for a
period of 12 consecutive months by reason of illness, accident, or other physical or mental
disability (“Permanent Disability”), this Agreement shall be deemed to be terminated as of the date
of such death or of the determination of Permanent Disability. Notwithstanding the foregoing,
Rouster or his estate shall be entitled to the severance and related listed benefits as set forth
in Section 8(b) of this Agreement (collectively, the “Severance Benefits”). Additionally, during
the period prior to a determination of Permanent Disability in which Roster is incapable of
performing the services contemplated under this Agreement, Rouster shall continue to receive the
Base Compensation he was receiving at the time as provided in Section 3 of this Agreement paid on a
pro rata basis to the date of any determination of Permanent Disability.
6. Severance Benefits in the Case of Termination By MTLM Without Cause or By Rouster for
Good Reason. In the event MTLM terminates Rouster’s employment with the Subsidiaries without
Cause as defined in Section 7(b) of this Agreement, including as a result of a Change of Control as
defined in Section 10(a), or if Rouster terminates his employment with the Subsidiaries for Good
Reason as defined in Section 8(a)(ii), all of Rouster’s benefits under this Agreement shall cease
immediately to the extent allowed by applicable federal and state law upon the date of such
termination, provided that Rouster shall receive the Severance Benefits set forth in Section 8(b)
of this Agreement.
7. No Severance Benefits in the Case of Termination By MTLM for Cause, By Rouster Without
Good Reason, or By Employee Due to Change in Control and in Accordance with Section 9(b) of this
Agreement.
(a) No Severance Benefits. In the event: (i) MTLM terminates Rouster’s
employment with the Subsidiaries for Cause as defined in Section 7(b) below; (ii) Rouster
voluntarily terminates his employment with the Subsidiaries without Good Reason as defined
in Section 8(a)(ii); or (iii) Rouster terminates his employment with the Subsidiaries due to
a Change in Control in accordance with Section 9(b) of this
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Agreement; unless otherwise provided herein, all Rouster’s compensation and benefits
under this Agreement shall cease immediately to the extent allowed by applicable federal and
state law upon the date of such termination, provided that Rouster shall receive the Base
Compensation he was then receiving as provided in Section 3 of this Agreement paid on a pro
rata basis to the date of such termination except that in the case of a termination as
described above in Section 7(a)(iii) such compensation pursuant to Section 3 of this
Agreement shall be paid for the period of time so provided in Section 10(b) of this
Agreement.
(b) Termination for Cause. Any of the following events shall be considered as
“Cause” for the immediate termination of the Employment Period by MTLM:
(i) final and non-appealable conviction of Rouster for a felony or a nolo
contendere plea with respect to a felony; or
(ii) final and non-appealable conviction of Rouster for (a) misappropriation by
Rouster of funds or property of MTLM or any Affiliated Entity as defined below or
(b) the commission of other acts of dishonesty relating to his employment; or
(iii) (a) willful breach of this Agreement which is not cured by Rouster within
three days following receipt by Rouster of written notice of such breach from MTLM
or (b) material neglect by Rouster of any of his material duties or responsibilities
hereunder which is not cured by Rouster within 10 days following receipt by Rouster
of written notice of the acts that MTLM assert constitute such neglect by Rouster,
provided, however, that any such willful breach which is not curable shall be
considered Cause for the immediate termination of the Employment Period by MTLM; or
(iv) conduct on the part of Rouster that is materially adverse to any known
interest of MTLM or any Affiliated Entity as defined below that continues unabated,
or uncured to the reasonable satisfaction of MTLM, after the expiration of 10 days
following receipt of written notice by Rouster from MTLM.
Notwithstanding the foregoing, Rouster shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to him a written termination notice signed
by the Chief Executive Officer of MTLM, Chairman of the Board, or another member of the
Board duly authorized to deliver such notice.
8. Acceleration of Payments.
(a) For this Agreement, the following terms shall have the following meanings:
(i) “Affiliated Entity” means, with respect to MTLM, any other entity or
entities, including but not limited to the Subsidiaries, directly or indirectly
controlling, controlled by, or under common control with MTLM, as well as any joint
venture involving MTLM and, for purposes of this definition,
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“control” means the power to direct or cause the direction of the management or
policies of the controlled entity.
(ii) “Good Reason” shall mean the occurrence of any of the following events
without Rouster’s express written consent: (a) a reduction by MTLM of Rouster’s
compensation from any level provided for and attained pursuant to the terms of
Section 3 of this Agreement; (b) any material breach by MTLM of any provisions of
this Agreement that is not cured by MTLM within 10 days following receipt by MTLM of
written notice of such breach from Rouster; (c) an assignment without Rouster’s
consent by MTLM that Rouster perform his duties more than 100 miles outside of the
Chicago city limits, other than periodic trips to MTLM’s operations and customers
and corporate meetings outside of the Chicago area; (d) MTLM’s assignment of Rouster
to a position or MTLM’s assignment of responsibilities or duties to Rouster of a
materially lesser degree of status, duties and responsibility than the status,
duties and responsibilities as of the Commencement Date; (e) an action by the
committee appointed by the MTLM Board to administer the Plan that materially reduces
the value of the Options awarded in connection with Section 3(c) of this Agreement
and has the result of treating Rouster materially differently than other employees
and directors who received options, stock appreciation rights or stock grants under
the Plan.
(iii) “Trigger Date” means the date on which a Triggering Event occurs.
(iv) “Triggering Event” means: (a) a termination of Rouster’s employment with
the Subsidiaries under Section 5 of this Agreement; (b) a termination of Rouster’s
employment with the Subsidiaries by MTLM without Cause; or (c) a termination of
Rouster’s employment with the Subsidiaries by Rouster for Good Reason whether within
or without 120 days of a Change of Control.
(b) Occurrence of Triggering Event. Upon the occurrence of a Triggering Event,
Rouster or his estate shall receive from MTLM a lump sum payment equal to the Base
Compensation Rouster was then receiving at the time of the Triggering Event as provided
under Section 3(a) of this Agreement that otherwise would have been payable to Rouster
through March 31, 2008, but for the occurrence of a Triggering Event. Furthermore, any
unvested stock options or stock grants or any unvested long term incentive plan
compensation, including, but not limited to the Options and the MTLM Restricted Stock shall
immediately become vested. Additionally, unless (i) MTLM terminates Rouster’s employment
with the Subsidiaries for Cause, (ii) Rouster terminates his employment with the
Subsidiaries without Good Reason, or (iii) Rouster’s employment is terminated as a result of
Rouster’s death, Rouster shall, at no cost to Rouster, be entitled to continue to
participate in the MTLM-provided health and medical insurance programs until March 31, 2008,
irrespective of any then pre-existing health conditions of Rouster or his spouse provided,
however, that, if this Agreement is terminated as a result of Rouster’s death, Rouster’s
then current spouse shall be entitled to continue to participate in the MTLM-provided health
and medical insurance programs
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for one year after Rouster’s death irrespective of any then pre-existing health
conditions, unless, in each case, such continued participation is prohibited by any
applicable laws or would otherwise jeopardize the tax qualified status of any such programs.
If MTLM is prohibited by applicable law or would otherwise jeopardize the tax qualified
status of any health or medical insurance plan and as a result MTLM terminates coverage, it
shall promptly reimburse Rouster (or Rouster’s spouse as the case may be) for the cost of
obtaining comparable third party coverage irrespective of any then preexisting health
conditions of Rouster and/or his spouse.
(c) Time of Payment Following Triggering Event. All accelerated payments of
Base Compensation, bonuses, and long term incentive plan compensation due to Rouster
pursuant to this Section shall be paid promptly but in any event within 30 days after the
Trigger Date.
(d) No Mitigation Obligation. Rouster shall not be required to mitigate
damages or the amount of any Severance Benefits provided to him pursuant to Section 8(b) of
this Agreement, or benefits provided to him pursuant to Section 10(b) of this Agreement, by
seeking other employment or otherwise, nor shall the amount of any Severance Benefits
provided to Rouster under Section 8(b) of this Agreement, or benefits provided to him
pursuant to Section 10(b) of this Agreement, be reduced by any compensation earned by
Rouster as the result of employment by another employer after the termination of Rouster’s
employment or otherwise.
9. Non-Competition.
(a) General. Subject to the provisions of Section 9(b) below, in addition to
any other obligations of Rouster under any other agreement with MTLM, in order to assure
that MTLM shall realize the benefits of this Agreement and in consideration of the
employment set forth in this Agreement, Rouster shall not:
(i) during the period beginning on the date of this Agreement and ending
eighteen months after the Termination Date (the “Non-Competition Period”), directly
or indirectly, whether through an affiliate or otherwise, alone or as a partner,
joint venturer, member, officer, director, employee, consultant, agent, independent
contractor, stockholder, or in any other capacity of any company or business, engage
in any business activity in competition with MTLM or any subsidiary or affiliate of
MTLM (A) prior to the Termination Date, in any activity that is conducted by or
actively planned by MTLM management to be conducted by MTLM or any subsidiary or
affiliate of MTLM in any state in the United States in which MTLM or any subsidiary
or affiliate of MTLM conducts business or is actively planned by MTLM management to
conduct business and (B) on and after the Termination Date, in any activity that is,
on the Termination Date, conducted by or actively planned by MTLM management to be
conducted by MTLM or any subsidiary or affiliate of MTLM in any state of the United
States in which, on the Termination Date, MTLM or any subsidiary or affiliate of
MTLM conducts business or is actively planned by MTLM management to conduct
business; provided, however; that Rouster’s beneficial ownership of less than 5%
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of the shares of stock of any corporation having a class of equity securities
actively traded on a national securities exchange or over-the-counter market shall
not be deemed, in and of itself, to violate the prohibitions of this Section;
provided, however, that Rouster shall not be bound by the restrictions set forth in
this Section 9(a)(i) if MTLM shall not have cured the failure to make any material
payment to Rouster under this Agreement within 30 days following receipt by MTLM of
written notice from Rouster of such failure unless such failure to make such payment
is due to MTLM’s allegation of a material breach of the terms of this Agreement;
(ii) during the Non-Competition Period, directly or indirectly (A) induce any
person which is a customer of MTLM or any subsidiary or affiliate of MTLM on the
Termination Date to patronize any business directly or indirectly in competition
with the business conducted by MTLM or any subsidiary or affiliate of MTLM on the
Termination Date; (B) canvass, solicit or accept from any person which is a customer
of MTLM or any subsidiary or affiliate of MTLM on the Termination Date, any such
competitive business, or (C) request or advise any person that is a customer of MTLM
or any subsidiary or affiliate of MTLM on the Termination Date to withdraw, curtail
or cancel any such customer’s business with MTLM or any subsidiary or affiliate of
MTLM;
(iii) during the Non-Competition Period, directly or indirectly employ, or
knowingly permit any company or business directly or indirectly controlled by
Rouster, to employ, any person who was employed by MTLM or any then subsidiary or
affiliate of MTLM at or within six months prior to the Termination Date, or in any
manner seek to induce any such person to leave his or her employment; or
(iv) directly or indirectly, at any time following the Termination Date, in any
way utilize, disclose, copy, reproduce or retain in his possession any of MTLM’s or
any subsidiary’s or affiliate’s proprietary rights or records, including, but not
limited to, any of their customer or price lists.
(b) Rouster’s Right To Elect to End Non-Competition Period. In the event that
a Change in Control occurs, Rouster shall have the right to elect, within 120 days of such
Change of Control, to terminate his employment with the Subsidiaries, effective as of 90
days after such election. The Non-Competition Period shall terminate effective as of the
date of such termination. In the event of a termination under this clause (b), Rouster
shall not be entitled to Severance Benefits except for the benefits set forth in Section
10(b) of this Agreement.
(c) Scope of Restriction. Rouster agrees and acknowledges that the
restrictions contained in this Section 9 are reasonable in scope and duration and are
necessary to protect MTLM after the Commencement Date. If any provision of this Section 9
as applied to any party or to any circumstance is adjudged by a court to be invalid or
unenforceable, the same shall in no way affect any other circumstance or the validity or
enforceability of this Agreement. If any such provision, or any part thereof, is
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held to be unenforceable because of the duration of such provision or the area covered
thereby, the parties agree that the court making such determination shall have the power to
reduce the duration and/or area of such provision, and/or to delete specific words or
phrases, and in its reduced form, such provision shall then be enforceable and shall be
enforced. The parties agree and acknowledge that the breach of this Section 9 shall cause
irreparable damage to MTLM and upon breach of any provision of this Section 9, MTLM shall be
entitled to injunctive relief, specific performance or other equitable relief; provided,
however, that this shall in no way limit any other remedies that MTLM may have (including,
but not limited to, the right to seek monetary damages).
10. Change of Control.
(a) General. For purposes of this Agreement and with respect to any options,
stock grants and stock appreciation rights issued under the Plan to Executive, “Change of
Control” shall be deemed to mean a “change in control” of the Company of a nature that would
be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934, as amended (the “1934 Act”), as in
effect at the time of such “change in control,” provided that such a change in control shall
be deemed to have occurred at such time as (1) any “person” (as that term is used in
Sections 13(d) and 14(d)(2) of the 0000 Xxx) becomes after the effective date of this
Agreement the beneficial owner (as defined in Rule 13d-3 under the 0000 Xxx) directly or
indirectly of securities representing 45% or more of the combined voting power of the then
outstanding securities for election of directors of the Company or any successor to the
Company, (2) during any period of two consecutive years or less, individuals who at the
beginning of such period constitute the MTLM Board cease, for any reason, to constitute at
least a majority of the MTLM Board, unless the election or nomination for election of each
person who was not a director at the beginning of such period was approved by vote of at
least two-thirds of the directors then in office who were directors at the beginning of such
period or who were directors previously so approved, (3) there is a dissolution or
liquidation of the Company or any sale or disposition of 50% or more of the assets or
business of the Company, or (4) there is a reorganization, merger, consolidation or share
exchange (other than a reorganization, merger, consolidation, or share exchange with a
wholly-owned subsidiary of the Company) of the Company unless (A) the persons who were the
beneficial owners of the outstanding shares of the common stock of the Company immediately
before the consummation of such transaction beneficially own more than 50% of the
outstanding shares of the common stock of the successor or survivor corporation in such
transaction immediately following the consummation of such transaction and (B) the shares of
the common stock of such successor or survivor corporation beneficially owned by the persons
described in clause (A) immediately following the consummation of such transaction are
beneficially owned by each such person in substantially the same proportion that each such
person had beneficially owned shares of Company common stock immediately before the
consummation of such transaction.
(b) Occurrence of a Change of Control Termination Election. Upon the
occurrence of (i) a Change of Control and (ii) Rouster’s election to terminate this
employment with the Subsidiaries, as set forth in Section 9(b) of this Agreement, Rouster
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shall be entitled to receive an amount equal to one year of Base Compensation Rouster
was then receiving at the time of such termination and any unvested stock options or stock
grants or any unvested long term incentive plan compensation, including, but not limited to
the Options and the MTLM Restricted Stock, shall immediately become vested.
11. Confidentiality of Information; Duty of Non-Disclosure. Rouster acknowledges and
agrees that his employment with the Subsidiaries under this Agreement necessarily involves his
understanding of and access to certain trade secrets and confidential information pertaining to the
business of MTLM or any subsidiary or affiliate of MTLM. Accordingly, during the Employment
Period, and until the expiration of the Non-Competition Period, Rouster shall not, directly or
indirectly, without the prior written consent of MTLM, disclose to or use for the benefit of any
person, corporation or other entity, or for himself any and all files, trade secrets or other
confidential information concerning the internal affairs of MTLM or any subsidiary or affiliate of
MTLM, including, but not limited to, confidential information pertaining to clients, services,
products, earnings, finances, operations, methods or other activities; provided, however, that the
foregoing shall not apply to information which is of public record or is generally known, disclosed
or available to the general public or the industry generally. Further, Rouster shall not, directly
or indirectly, remove or retain, without the express prior written consent of MTLM, and upon
termination of this Agreement for any reason shall return to MTLM, any confidential figures,
calculations, letters, papers, records, computer disks, computer print-outs, lists, documents,
instruments, drawings, designs, programs, brochures, sales literature, or any copies thereof, or
any information or instruments derived there from, or any other similar information of any type or
description, however such information might be obtained or recorded, arising out of or in any way
relating to the business of MTLM or any subsidiary or affiliate of MTLM or obtained as a result of
his employment with the Subsidiaries. Rouster acknowledges that all of the foregoing are
proprietary information, and are the exclusive property of MTLM. The covenants contained in this
Section 11 shall survive the termination of this Agreement.
12. Authority; Enforceability. MTLM has full corporate power and authority to execute
and deliver this Agreement and to perform its obligations hereunder. The execution and delivery of
this Agreement, the performance by MTLM of its obligations hereunder have been duly and validly
authorized by all necessary corporate action on the part of MTLM. This Agreement has been duly
executed and delivered by MTLM and constitutes a valid and binding agreement of MTLM, enforceable
against MTLM in accordance with its terms, subject to applicable bankruptcy, insolvency and other
similar laws affecting the enforceability of creditors’ rights generally, general equitable
principles and the discretion of courts in granting equitable remedies.
13. Goodwill. MTLM has invested substantial time and money in the development of its
products, services, territories, advertising and marketing thereof, soliciting clients and creating
goodwill. By accepting employment with MTLM, Rouster acknowledges that the customers are the
customers of MTLM and its subsidiaries and affiliates and that any goodwill created by Rouster
belongs to and shall insure to the benefit of XXXX.
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00. Notices. Any notice or request to be given hereunder to either party hereto shall
be deemed effective only if in writing and either (a) delivered personally or (b) sent by certified
or registered mail, postage prepaid, to the following addresses or to such other address as either
party may hereafter specify to the other by notice similarly served:
If to Rouster:
Xxxxxx X. Xxxxxxx
0000 Xxxxx Xxxxx Xxxxx
Xxxxx, Xxxx 00000
0000 Xxxxx Xxxxx Xxxxx
Xxxxx, Xxxx 00000
with a copy to:
Xxxxxx & Xxxxxxx LLP
Xxxxxxxx X. Xxxxxxxx, Esq.
00 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Xxxxxxxx X. Xxxxxxxx, Esq.
00 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
If to MTLM:
Metal Management, Inc.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn:Xxxxxx X. Xxxxxx
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn:Xxxxxx X. Xxxxxx
with a copy to:
King & Spalding LLP
E. Xxxxxxx Xxxxx, II, Esq.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
E. Xxxxxxx Xxxxx, II, Esq.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
15. Assignment. This Agreement shall be binding upon and inure to the benefit of the
successors and assigns of MTLM, whether by merger, sale of assets or otherwise. This Agreement
shall be binding upon and inure to the benefit of Rouster’s heirs.
16. Attorneys’ Fees. (a) Upon receipt by MTLM of statement for legal services from
the attorneys representing Rouster, MTLM shall reimburse Rouster or pay on behalf of Rouster the
reasonable and necessary attorneys’ fees and associated expenses incurred by Rouster in connection
with the negotiation of this Agreement.
(b) In the event suit or action is brought by any party under this Agreement to enforce or
construe any of its terms, the prevailing party shall be entitled to recover, in addition to all
other amounts and relief, its reasonable and necessary attorneys’ fees and associated expenses
incurred at and in preparation for arbitration, trial, appeal and review.
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17. Governing Law. This Agreement shall be construed and enforced in accordance with
the laws of the State of Illinois without reference to its choice-of-law principles.
18. Venue. Any action at law, suit in equity or judicial proceeding arising directly,
indirectly or otherwise in connection with, out of, related to or from this Agreement or any
provision hereof shall be litigated only in the state courts of Illinois or the United States
District Court for the Northern District of Illinois.
19. Modification. No modification or waiver of any provision hereof shall be made
unless it is in writing and signed by both of the parties hereto.
20. Scope of Agreement. This Agreement constitutes the whole of the agreement between
the parties on the subject matter, superseding all prior oral and written conversations,
negotiations, understandings, and agreements in effect as of the date of this Agreement.
21. Severability. To the extent that any provision of this Agreement may be deemed or
determined to be unenforceable for any reason, such unenforceability shall not impair or affect any
other provision, and this Agreement shall be interpreted so as to most fully give effect to its
terms and still be enforceable.
22. Survival. The parties expressly acknowledge and agree that the provisions of this
Agreement that by their express or implied terms extend beyond the expiration of this Agreement or
the termination of Rouster’s employment under this Agreement shall continue in full force and
effect, notwithstanding Rouster’s termination of employment under this Agreement or the termination
of this Agreement.
23. Waivers. No failure on the part of either party to exercise, and no delay in
exercising, any right or remedy under this Agreement shall operate as a waiver thereof; nor shall
any single or partial exercise of any right or remedy under this Agreement preclude any other or
further exercise thereof or the exercise of any other right or remedy granted hereby or by any
related document or by law.
24. Execution in Counterparts. This Agreement may be executed in any number of
counterparts and by different parties in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall constitute one and the same
agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective officers thereunto duly authorized, as of the date first above written.
| METAL MANAGEMENT, INC. |
|||||
| Dated: February 25, 2004 | By | /s/ Xxxxxx X. Xxxxxx | |||
| Xxxxxx X. Xxxxxx | |||||
| Chief Executive Officer | |||||
| Dated: February 24, 2004 | /s/ Xxxxxx X. Xxxxxxx | ||||
| Xxxxxx X. Xxxxxxx | |||||
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