Exhibit 10.10

December 23, 2011

By Federal Express

Douglas J. Mattscheck

403 Lakestone Way

Martinez, GA 30907

Dear Doug:

As we have discussed, your employment with KAGY Holding Company, Inc. (the
“Company”) and AGY Holding Corp. (the “Principal Subsidiary”) has terminated,
effective as of December 20, 2011 (such date, the “Separation Date” and this
letter agreement, the “Agreement”). Reference is made to the Amended and
Restated Employment Agreement between you, the Company and the Principal
Subsidiary dated as of April 7, 2006 (the “Employment Agreement”). All
capitalized terms used in this letter will have the meaning ascribed to them in
the Employment Agreement unless otherwise expressly provided herein. The purpose
of this letter is to confirm the agreement between you, the Company and the
Principal Subsidiary concerning your separation from employment and severance
benefits, as follows:

1. Resignation. You hereby resign from your employment, from any and all
positions and offices you hold with the Company, the Principal Subsidiary or any
of their Affiliates, and from any and all memberships you hold on any boards of
directors or other governing boards of the Company, the Principal Subsidiary and
those Affiliates and any and all memberships you hold on any of the committees
of any such boards (together, the “Resignations”), such Resignations to be
effective as of the Separation Date. The Company and the Principal Subsidiary,
on their own behalf and on behalf of their Affiliates, hereby accept the
Resignations as of the Separation Date. It is understood and agreed that the
Company, the Principal Subsidiary and their Affiliates will take actions in
reliance on the Resignations and that the Resignations will become irrevocable
on the Separation Date. You agree to sign and return such documents confirming
the Resignations as the Company, the Principal Subsidiary or any of their
Affiliates may reasonably request.

2. Final Wages and Vacation Pay. On or before the next regular payday following
the Separation Date, you will receive pay, at your final base rate of pay, for
all work performed for the Company from the end of the last payroll period
through the Separation Date, to the extent not previously paid. In addition, the
Company will continue to pay you your base salary, at the annual rate of
$373,171.68 (the “Base Salary”), from the day immediately following the
Separation Date through December 31, 2011.

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3. Severance Benefits. In consideration of your acceptance of this Agreement and
subject to your fully meeting your obligations under it, and in full
satisfaction of any rights you may have under the Employment Agreement, the
Company will provide you with the following pay and benefits:

(a) The Company will continue to pay you your Base Salary for a period of twelve
(12) months following the Separation Date (the “Severance Pay Period”). Payments
(which will be in addition to the payments described in Section 2) will be made
in the form of salary continuation, and will begin on the next regular Company
payday which is at least five (5) business days following the later of the
effective date of this Agreement or the date this Agreement, signed by you, is
received by the Company. (As indicated below, this Agreement will take effect on
the eighth (r) day following the date of your signing, provided you do not
timely revoke it.) The first payment, however, will be retroactive to the next
business day following the Separation Date.

(b) The Company will pay you a portion of your Target Bonus equal to
$111,951.50, which amount represents thirty percent (30%) of the Base Salary, on
the date when annual bonuses in respect of 2011 would normally be paid (and in
all events no later than May 1, 2012).

(c) If you are enrolled in the Company’s medical, dental and vision plans on the
Separation Date, you may elect to continue your participation and that of your
eligible dependents in those plans for a period of time under the federal law
commonly known as “COBRA.” The Company will provide you, under separate cover,
with additional information concerning your COBRA rights, which are available to
you whether or not you sign this Agreement. If you elect coverage under COBRA by
signing and returning the COBRA election form no later than the date you are
required to sign and return this Agreement, then, until the conclusion of the
Severance Pay Period, provided you remain eligible for coverage under COBRA and
Company plans, you will pay the full monthly premium cost for such coverage and
the Company will pay you a cash amount equal, on an after-tax to you basis, to
the Company’s portion of the premium cost of your coverage and that of your
eligible dependents under the Company’s medical, dental and vision plans as of
the Separation Date. The Company shall make such payments to you on the first
regular Company payday of each month, commencing with the month immediately
following the Separation Date, provided that the first payment shall be made on
the next regular Company payday which is at least five (5) business days
following the later of the effective date of this Agreement or the date this
Agreement, signed by you, is received by the Company. To be eligible for these
payments, however, you must notify the Company immediately if you begin new
employment during the period when the Company is making such payments.

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Notwithstanding the foregoing, if the payment by the Company of the payments
described herein will subject or expose the Company to taxes or penalties, you
and the Company agree to renegotiate the provisions of this Section 3(c) in good
faith and enter into a substitute arrangement pursuant to which the Company will
not be subjected or exposed to taxes or penalties and you will be provided you
with payments or benefits with an economic value that is no less than the
economic value of the payments described herein.

(d) You currently hold an option to purchase 400,000 shares of common stock of
the Company (the “Option”), pursuant to the terms of the Company’s 2006 Stock
Option Plan (the “Plan) and your option award dated as of April 7, 2006 (your
“Option Award”). As of the Separation Date, the Option is vested as to 267,000
shares subject to the Option (the “Vested Option”). The remaining portion of the
Option is unvested and, in accordance with the terms of the Plan and your Option
Award, is forfeited and terminated without the payment of any consideration
therefor effective as of the Separation Date. In respect of the Vested Option,
(i) the Company and the Investors (as defined in the Stockholders Agreement
referenced below) each agree not to exercise the call option provided for in
Section 2(e) of the Option Award as to 100,000 shares of common stock subject to
the Vested Option (the “Continuing Option”), which Continuing Option shall
remain outstanding as to such 100,000 shares in accordance with the terms of the
Option Award and the Plan, and (ii) you agree to forfeit, as of the Separation
Date, the remaining Vested Option to purchase 167,000 shares of the Company’s
common stock. The Continuing Options will remain exercisable for up to 100,000
shares of the Company’s common stock until April 7, 2016, subject to the terms
of the Plan and your Option Award.

4. Acknowledgement of Full Payment, Status of Benefits and Tax Withholding. You
acknowledge and agree that the payments provided under paragraphs 2 and 3 of
this Agreement are in complete satisfaction of any and all compensation or
benefits due to you from the Company, the Principal Subsidiary or any of their
Affiliates, whether for services provided, under the Employment Agreement or
otherwise, through the Separation Date and that, except as expressly provided
under this Agreement, no further compensation or benefits are owed or will be
paid to you. Except as otherwise expressly provided in Section 3(c), your
participation in all employee benefit plans and programs of the Company will end
as of the Separation Date, in accordance with the terms of those plans and
programs. You will not continue to earn vacation or other paid time off after
the Separation Date. All payments made by the Company under this Agreement will
be reduced by all taxes and other amounts that the Company is required to
withhold under applicable law.

5. Equity Ownership. As of the Separation Date, you hold (i) 100,000 shares of
common stock of the Company, pursuant to the Management Investor Subscription
Agreement dated as of April 7, 2006, (ii) an additional 100,000 shares of common
stock of

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the Company, free of any vesting restrictions, pursuant to the terms of the
restricted stock award agreement dated as of April 7, 2006 (your “Restricted
Stock Award”), and (iii) the Continuing Option, in each case subject to the
terms of the applicable award or other agreements and the Stockholders Agreement
between the Company, KAGY Acquisition Corp. and certain stockholders of the
Company dated as of April 7, 2006 (the “Stockholders Agreement”). You agree to
waive, from and after the Separation Date, your information rights under
Section 6.1.1(c) of the Stockholders Agreement, and acknowledge and agree that
you will not be provided with the information described in such section
following the end of each month ending after the Separation Date. Except as
described above you remain subject to the terms of the Stockholder Agreement in
all respects, including without limitation with respect to the delivery by the
Company of quarterly and annual information under Section 6.1.1(a) and
Section 6.1.1(b).

6. Return of Documents and Other Property. In signing this Agreement, you
represent and warrant that you have returned to the Company any and all
documents, materials and information (whether in hardcopy, on electronic media
or otherwise) related to Company business (whether present or otherwise) and all
keys, access cards, credit cards, computer hardware and software, telephones and
telephone-related equipment and all other property of the Company in your
possession or control. Further, you represent and warrant that you will not
retain copies of any Company documents, materials or information (whether in
hardcopy, on electronic media or otherwise). Recognizing that your employment
with the Company has ended as of the Separation Date, you agree that you will
not, for any purpose, attempt to access or use any Company computer or computer
network or system, including without limitation its electronic mail system.
Further, you acknowledge that you will disclose to the Company all passwords
necessary or desirable to enable the Company to access all information which you
have password-protected on any of its computer equipment or on its computer
network or system.

7. Confidentiality and Non-Disparagement.

(a) You acknowledge and agree that you remain bound by Sections 7, 8 and 9 of
the Employment Agreement, and hereby affirm your obligations under such
provisions with respect to confidentiality, non-competition, non-solicitation,
assignment of rights to intellectual property and notification to the Company of
new business activities.

(b) In exchange for the severance pay, benefits and other promises set forth
herein, you agree and affirm as of the Separation Date, that:

(i) You shall comply with the policies and procedures of the Company and its
Affiliates for the protection of Confidential Information and shall never
disclose to any Person (except as required by applicable law), or use for your
own benefit or gain, any Confidential Information obtained by you incident to
your employment or other association with the Company or any of its Affiliates.

 

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(ii) Until the date that is twelve (12) months after the Separation Date (the
“Non-Competition Period”), you shall not, directly or indirectly, whether as
owner, partner, investor, consultant, agent, employee, co-venturer or otherwise,
compete with the Company or any of its Affiliates or undertake any planning for
any business competitive with the Company or any of its Affiliates within the
Restricted Territory. For purposes of this Agreement, “Restricted Territory”
means (i) any state in the continental United States; (ii) Alaska and Hawaii;
(iii) any other territory or possession of the United States; and (iv) any other
country in which any Product has been manufactured, provided, sold or offered or
promoted for sale by the Company or any of its Affiliates at any time during the
period of your employment or with respect to which the Company or any of its
Affiliates has devoted substantial expense in anticipation of launching into
such geographic area a portion of their business. Specifically, but without
limiting the foregoing, you agrees not to engage in any manner in any activity
that is directly or indirectly competitive or potentially competitive with the
business of the Company or any of its Affiliates as conducted or under
consideration at any time during your employment. Restricted activity includes
without limitation accepting employment or a consulting position with any Person
who is, or at any time within twelve (12) months prior to termination of your
employment has been, a customer of the Company or any of its Affiliates. For the
purposes of this Section 7, the business of the Company and its Affiliates shall
include all Products and your undertaking shall encompass all items, products
and services that may be used in substitution for Products.

(ii) During the Non-Competition Period, you will not hire or attempt to hire any
employee of the Company or any of its Affiliates, assist in such hiring by any
Person, encourage any such employee to terminate his or her relationship with
the Company or any of its Affiliates, or solicit or encourage any customer or
vendor of the Company or any of its Affiliates to terminate its relationship
with them, or, in the case of a customer, to conduct with any Person any
business or activity which such customer conducts or could conduct with the
Company or any of its Affiliates.

(c) You agree that you will not disclose this Agreement or any of its terms or
provisions, directly or by implication, except to members of your immediate
family and to your legal and tax advisors, and then only on condition that they
agree not to further disclose this Agreement or any of its terms or provisions
to others. You also agree that you will never disparage or criticize the
Company, its business, its management or its services, and that you will not
otherwise do or say anything that could disrupt the good morale of Company
employees or harm its interests or reputation.

8. Release of Claims.

(a) The Company and the Principal Subsidiary want to be certain that this
Agreement will resolve any and all concerns that you might have and therefore
requests that you carefully consider the terms of this Agreement, including the
release of claims set forth below. This Agreement, which includes the release of
claims, creates legally-binding obligations and the

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Company and the Principal Subsidiary therefore advise you to consult an attorney
before you sign this Agreement.

(b) In exchange for the special severance pay and benefits provided to you under
this Agreement, and for other good and valuable consideration not otherwise due
to you, the receipt and sufficiency of which is hereby acknowledged, on your own
behalf and that of your heirs, executors, administrators, beneficiaries,
personal representatives and assigns, you agree that this Agreement shall be in
complete and final settlement of any and all causes of action, rights and
claims, whether known or unknown, that you have had in the past, now have, or
might now have, in any way related to, connected with or arising out of your
employment or its termination or pursuant to Title VII of the Civil Rights Act,
the Americans with Disabilities Act, the Age Discrimination in Employment Act,
as amended by the Older Workers Benefit Protection Act, the Employee Retirement
Income Security Act, the fair employment practices statutes of the state or
states in which you have provided services to the Company or the Principal
Subsidiary, and/or any other federal, state or local law, regulation or other
requirement, each as amended from time to time (all of the foregoing causes of
action, rights and claims, collectively, “Claims”), and you hereby release and
forever discharge the Company, the Principal Subsidiary and all of their past,
present and future subsidiaries, affiliates, officers, directors, trustees,
shareholders, employees, employee benefit plans, agents, general and limited
partners, members, managers, investors, joint venturers, representatives,
successors and assigns, and all others connected with any of them both
individually and in their official capacities, from any and all such Claims.

9. Miscellaneous.

(a) This Agreement constitutes the entire agreement between you, the Company and
the Principal Subsidiary, and replaces all prior and contemporaneous agreements,
communications and understandings, whether written or oral, with respect to your
employment and its termination and all related matters, excluding only Sections
7, 8, 9 and 10 of the Employment Agreement and any other provisions necessary or
desirable to accomplish fully the purpose of these provisions, the Plan, your
Option Award solely as to the Continuing Option, the Stockholders Agreement, the
Management Investor Subscription Agreement dated as of April 7, 2006, and your
Restricted Stock Award, all of which shall continue in full force and effect
subject to the terms hereof.

(b) This Agreement may not be modified or amended, and no breach shall be deemed
to be waived, unless agreed to in writing by you and an expressly authorized
representative of the Company and the Principal Subsidiary. The captions and
headings in this Agreement are for convenience only and in no way define or
describe the scope or content of any provision of this Agreement.

(c) In signing this Agreement, you give the Company and the Principal Subsidiary
assurance that you have had a full and reasonable opportunity to

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consider its terms and to consult with an attorney, if you wished to do so, or
to consult with any other of those persons to whom reference is made in the
first sentence of paragraph 7(c) above; that you have read and understood all of
those terms; that your acceptance of this Agreement is freely and voluntarily
given; and that, in signing this Agreement, you have not relied on any promises
or representations, express or implied, that are not set forth expressly in this
Agreement.

(d) The obligation of the Company to make payments or provide benefits to you or
on your behalf under this Agreement, and your right to retain the same, is
expressly conditioned upon your continued full performance of your obligations
under this Agreement.

(e) This is a Delaware contract and shall be construed and enforced under and be
governed in all respects by the laws of the State of Delaware, without regard to
the conflict of laws principles thereof. In the event of any alleged breach or
threatened breach of this Agreement, the parties hereby consent and submit to
the jurisdiction of the federal and state courts in and of the State of Delaware
and to service of legal process in the State of Delaware.

[Rest of page is intentionally left blank.]

 

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If the terms of this Agreement are acceptable to you, please sign and return it
to Seth M. Hollander, Vice President no later than 21 days from the date you
receive it. You may revoke this Agreement at any time during the seven-day
period immediately following the date of your signing by notifying Seth M.
Hollander, Vice President in writing of your revocation within that period. If
you do not timely revoke this Agreement, then, at the expiration of the
seven-day period, this Agreement shall take effect as a legally binding
agreement among you, the Company and the Principal Subsidiary on the basis set
forth above. The enclosed copy of this letter, which you should also sign and
date, is for your records.

 

Sincerely,

 

KAGY HOLDING COMPANY, INC.

By:   /s/ Seth M. Hollander

Name:

Title:

 

Seth M. Hollander

Vice President

 

 

AGY HOLDING CORP. By:   Seth M. Hollander

Name:

Title:

 

Seth M. Hollander

Vice President

Date:  

 

 

Accepted and agreed: Signature:   /s/ Douglas J. Mattscheck   Douglas J.
Mattscheck

Date: 12/24/11

 

 

Solely as to Section 3(d):

 

Kohlberg Partners V, L.P.

Kohlberg Investors V, L.P.

Kohlberg TE Investors V, L.P.

Kohlberg Offshore Investors V. L.P.

By: Kohlberg Management V, L.L.C., its general partner

By:    

Name:

Title:

 

Seth M. Hollander

Partner

Date: