Exhibit 10.2

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

            This Executive Employment Agreement ("Agreement") is made as of the
1st day of June, 2009 (the "Effective Date") by and between INDUSTRIAL SERVICES
OF AMERICA, INC., a Florida corporation located at 7100 Grade Lane, Building #1,
Louisville, Kentucky 40213 (the "Company") and JEFFREY VALENTINE, an individual
residing at 15946 Keeney Drive, Fairhope, Alabama 36532 ("the "Executive").

 

RECITALS

 

            The Company desires to employ the Executive, and the Executive
desires to be employed by the Company upon the terms and conditions set forth in
this Agreement.

 

            NOW THEREFORE, in consideration of (a) the Executive's employment
with the Company as its General Manager - ISA Alloys in Mobile, Alabama, (b) the
compensation paid to the Executive and the benefits provided to the Executive in
connection with such employment,  (c) the Executive's use of the equipment,
supplies, facilities and other resources of the Company and (d) the opportunity
provided to Executive by the Company to acquire or use information relating to
or based upon the Company's business and to work and develop in the industry and
lines of business engaged in by the Company from time-to-time or for which the
Executive is hereby employed hereunder, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:

 

ARTICLE 1

INTERPRETATION OF THIS AGREEMENT

 

            Article 1.1       Defined Terms.  As used herein, capitalized terms
when used in this Agreement shall have the meanings set forth in Annex 1
attached hereto and made a part hereof and as defined in this Agreement.

 

            Article 1.2       Interpretation.  The words "herein," "hereof,"
"hereunder" and other words of similar import refer to this Agreement and not
any particular section, paragraph, subparagraph or clause contained in this
Agreement.  Wherever from the context it appears appropriate, each term stated
in either the singular or plural shall include the singular and the plural, and
pronouns stated in masculine, feminine or neuter gender shall include the
masculine, feminine and the neuter.

 

ARTICLE 2

TERM OF EMPLOYMENT

 

            ARTICLE 2.1             Duration.  The Company agrees to employ the
Executive, and the Executive agrees to be so employed for an Initial Term
("Initial Term") commencing on the Effective Date of this Agreement, and ending
on the Termination Date (as defined below) or May 31, 2011, whichever shall
first occur.  The Executive's employment may be terminated earlier or renewed,
as herein provided, pursuant to this Article.  At any time more than ninety (90)
days prior to the expiration of the Initial Term or any Renewal Term,
respectively, either the Company or Executive may give notice of nonrenewal and
this Agreement shall terminate at the end of such term.  If a notice of
nonrenewal is not given or the Agreement is not terminated as set forth in
Article 2.2, Executive's employment under the terms of this Agreement shall be
extended for an additional one year period.  (The one year period shall be
defined as commencing on  June 1, 2011 and continuing for the next three hundred
sixty-five (365)/three hundred sixty-six (366) consecutive calendar days as
applicable.)

 

            ARTICLE 2.2             Termination.  The Executive's employment may
be terminated on any one or more of the following dates:  (a) the date specified
in a Notice of Termination given by the Executive in connection with his
voluntary termination (which shall not be less than thirty (30) days from the
date such Notice of Termination is given, unless a shorter period is
subsequently requested by the Company after receipt of such Notice of
Termination); (b) the date specified in a Notice of Termination given by the
Board of Directors of the Company to the Executive stating that the Executive's
employment is being Terminated for Cause; (c) the date specified in a Notice of
Termination given by the Board of Directors to the Executive stating that the
Executive's employment with the Company is terminated without cause; (d) the
date of the Executive's death; or (e) the date specified in a Notice of
Termination given by the Company at a time after which the Executive has become
Incapacitated in connection with a termination of the Executive's employment by
reason of his Incapacity.  Except as provided in Article 2.4, all obligations of
the Company to Executive shall terminate as of the Termination Date.

 

            ARTICLE 2.3             Salary and Benefits.  During the Employment
Period:

 

            ARTICLE 2.3.1          The Company will pay the Executive a Base
Salary at the rate of $3,846.15 per week ("Base Salary"), payable in
installments consistent with the Company's normal payroll schedule, subject to
applicable withholding and other taxes and other required deductions for
welfare, fringe benefits and withholding and those deductions requested by
Executive.   

 

            ARTICLE 2.3.2          The Executive will be entitled to participate
in all medical and hospitalization, group life insurance, retirement, and any
and all other welfare and fringe plan benefits as are from time to time provided
by the Company to its executive employees, subject to the provisions of such
plans, including, without limitation, eligibility criteria and contribution
requirements, as the same may be in effect from time to time.  The Company shall
provide Executive with a term life insurance policy with a death benefit not to
exceed $50,000.00, with the Executive to name his beneficiary(ies).

 

            ARTICLE 2.3.3          The Executive will be entitled to a maximum
of two (2) weeks paid vacation during each calendar year (prorated for any
partial year during the term) commencing in 2009 to be taken at such times and
intervals as shall be determined by the Executive, and approved by the President
of the Company, which approval shall not be unreasonably withheld and provided
in the President's judgment that the timing of such vacation shall not interfere
with the Executive's performance of his duties hereunder.  Unused vacation shall
not be accrued or reimbursed to Executive.

 

            ARTICLE 2.3.4          The Executive shall be entitled to
reimbursement of reasonable business expenses incurred by the Executive (subject
to Executive's submission of appropriate substantiation in accordance with the
rules in place for other executives of the Company).  In addition thereto, and
not in substitution thereof, the Company shall provide Executive with a monthly
car payment allowance (the amount of which shall not exceed $700.00 per month)
which shall be used by Executive to acquire an automobile selected by the
Executive, with the  concurrence of the Company, for use by the Executive during
his employment by the Company.  All normal operating expenses incurred in
connection with the operation of the automobile shall be borne by the
Executive.  The Executive shall, at his own expense, provide for comprehensive
insurance coverage for the vehicle, naming Company as a named insured. 
Executive shall provide proof of said coverage to Company, including existence
of minimum underlying limits and umbrella limits for bodily injury coverage in
the total amount of $1,500,000.  Executive shall be responsible for any damage
due to neglect or misuse by Executive.

 

            ARTICLE 2.3.5          During the Initial Term of this Agreement or
any subsequent Renewal Term Executive shall be entitled to receive no later than
five (5) business days after the filing of the applicable Annual Report on Form
10-K with the Securities and Exchange Commission an annual performance bonus in
cash equal to seven and one-half percent (7.5%) of the amount determined, for
each fiscal year of the Company during the Initial Term, by (i) the Segment
profit of ISA Alloys (the "Alloys Segment Profit") minus (ii) the product of (a)
the selling, general and administrative expenses under the Other category, times
(b) the percentage determined by dividing the Alloys Segment Profit by the
Segment profit under the Segment Totals category, all as reflected in the
Segment Information note of the Notes to Consolidated Financial Statements as
contained in the most recent Annual Report on Form 10-K filed with the
Securities and Exchange Commission, commencing with the Annual Report on Form
10-K to be filed with the Securities and Exchange Commission for the fiscal year
ended December 31, 2009; provided that the Executive has completed a minimum of
eleven (11) consecutive months of employment with the Company.

 

            ARTICLE 2.4             Severance Pay.

 

            ARTICLE 2.4.1          (a)  If the Executive's employment ends as
the result of a Termination Without Cause, the Executive shall be entitled to
receive his Base Salary and Welfare Plan Benefits (as defined below) through the
Initial Term as defined in Annex 1 or Renewal Term, as applicable;

 

                                    (b)  If the Executive's employment ends as
the result of Executive's Incapacity, Executive shall be entitled to receive
either available worker's compensation benefits or insured benefits as provided
by the Company's disability policy;

 

                                    (c)  If the Executive's employment ends as
the result of the death of Executive, Executive shall be entitled to receive his
Base Salary and Welfare Plan Benefits through the date of death;

 

                                    (d)  If the Executive's employment ends as
the result of Voluntary Termination, Executive shall be entitled to receive his
Base Salary and Welfare Plan Benefits through the Termination Date.  If
Executive elects Voluntary Termination, the date it shall become effective shall
not be more than thirty (30) days later unless Company agrees; or

 

                                    (e)  If the Executive's employment ends as
the result of Termination for Cause, Executive shall be entitled to receive his
Base Salary and Welfare Plan Benefits through the Termination Date. 

 

            ARTICLE 2.4.2          In those instances where the Company owes
Executive payments after the Termination Date, the payments to be made by the
Company to the Executive under this Article 2.4 shall be made in installments,
and on the payment dates, during the Severance Period (as defined below) on
which Base Salary would have otherwise been paid had the Executive's employment
not been terminated.  Upon the making of the last of such payments, the Company
will have no further Severance Payment obligation to the Executive.  All
payments shall be subject to applicable withholding and other taxes.

 

            ARTICLE 2.4.3          For so long as the Company is required to
make the severance payments described in this Article 2.4 (the "Severance
Period") and subject to the provisions of Article 2.4.4 below, the Company will,
in addition to such payment, provide or arrange to provide the Executive with
its regular subsidy payments toward benefits substantially similar to those
which the Executive was receiving or entitled to receive under the Company's
life, accident, dental and group health insurance plans, 401K, FSA or any
similar health or welfare plans in which the Executive was participating
immediately prior to the Termination Date ("Welfare Plan Benefits") at a cost to
the Company which is not greater than the cost it paid immediately prior to the
Termination Date.  Provided, that to the extent any such coverage is prohibited,
whether by contract, any judicial or legislative authority or otherwise, the
Company shall in its sole discretion make alternative arrangements to provide
the Executive with Welfare Plan Benefits or provide the Executive with a payment
in an amount equal to what the Company was contributing toward purchasing the
Welfare Plan Benefits for Executive immediately prior to the Termination Date. 
Benefits or payments otherwise receivable by the Executive pursuant to the
preceding sentence shall be reduced to the extent Company determines comparable
benefits are available from another employer .  Executive shall have the duty to
fully and promptly advise Company of any available benefits offered, whether
accepted or not no later than three (3) business days after any such benefits
are offered.

 

ARTICLE 3

PROPERTY AND BUSINESS OF THE COMPANY

 

            ARTICLE 3.1             Nondisclosure.  During the Employment Period
and during the periods described in the last sentence of this Article 3.1, the
Executive (a) will receive and hold all Company information in trust and in
strict confidence, (b) will not disclose and will use commercially reasonable
efforts to protect Company information from disclosure, (c) will not, directly
or indirectly, use or assist others to use any Confidential Information (as
hereinafter defined), and (d) will not, directly or indirectly, use, disseminate
or otherwise disclose any Company information or Confidential Information to any
third party, except in the case of each of (a) through (d) above, as required by
the Executive's duties in the course of his employment by the Company or as
required by applicable law.  The provisions of this Article 3.1 shall survive
the Termination Date.

 

            ARTICLE 3.2             Books and Records.  All books, records,
reports, writings, notes, inventions, notebooks, computer programs, sketches,
drawings, blueprints, prototypes, formulas, patents, photographs, negatives,
models, equipment, chemicals, reproductions, proposals, flow sheets, supply
contracts, customer lists and other documents and/or things relating to the
business of the Company, its affiliates or any of their respective subsidiaries
(including but not limited to any of the same embodying or relating to any
actual Confidential Information or trade secrets), whether prepared by the
Executive or otherwise coming into the Executive's possession, shall be the
exclusive property of the Company, its affiliates or such possession shall be
the exclusive property of the Company, its affiliates or such subsidiary, as the
case may be (all of which is defined herein as "Confidential Information"), and
shall not be copied, duplicated, replicated, transformed, modified or removed
from the premises of the Company except pursuant to the prior written
authorization of the Company on the Termination Date or on the Company's written
request at any time. 

 

            ARTICLE 3.3             Inventions and Patents.  The Executive
agrees that all inventions, innovations or improvements related to the Company's
or any of its respective subsidiaries' method of conducting its business
(including new contributions, improvements, ideas and discoveries, whether
patentable or not) conceived or made by him during the Employment Period with
the Company belong to the Company and the Executive hereby assigns all of such
inventions, innovations and improvements, contributions, ideas and discoveries
to the Company.  The Executive will promptly disclose such inventions,
innovations and improvements, contributions, ideas and discoveries to the Board
and perform all actions reasonably requested by the Board to establish and
confirm such ownership in the Company.

 

            ARTICLE 3.4             Non-Competition.  During the Employment
Period (which shall be deemed to include the Severance Period, if any, for
purposes of this Article 3) and for a period of twelve (12) months from and
after the later of the last payment made during the Severance Period or the
Termination Date (collectively, the "Non-Competition Period"), the Executive
will not directly or indirectly, (i) engage in any business which is the same or
substantially the same as any business of the Company (the "Restricted
Business") as of the date of the Executive's termination, or (ii) have any
interest in any other business venture, whether as a debt or equity holder,
employee, officer, director, member, manager, partner, agent, security holder,
consultant or otherwise, that directly or indirectly is engaged in the
Restricted Business, within one hundred (100) direct miles of any geographic
area in which the Company, its affiliates or any of their respective
subsidiaries, engage in the Company's business operations as of the Termination
Date.  Provided that, nothing in Article 3.4 shall be deemed to prevent the
Executive from acquiring and owning solely as a passive investment, equity
securities (including options to purchase equity securities) in an aggregate of
less than three percent (3%) in the aggregate of the equity securities of any
class of any issuer that are registered under Section 12(b) or 12(g) of the
Securities Exchange Act of 1934, as amended, and are listed or admitted for
trading on any United States national securities exchange or are quoted on the
National Association of Securities Dealer Automated Quotations System or any
similar system of automated dissemination of quotations of securities prices in
common use, or so long as the Executive is not a member of any "control group"
(within the meaning of the rules and regulation of the United States Securities
and Exchange Commission) of any such issuer.

 

            ARTICLE 3.5             Non-Solicitation of Employees.  During the
Non-Competition Period, the Executive shall not, directly or indirectly, (a)
solicit for employment or employ (or attempt to solicit for employment or
employ), for the Executive or on behalf of any other Person (other than the
Company or any of its respective subsidiaries) provided that nothing shall
prevent the Executive from making a general solicitation not targeted at the
Company's or any of its respective subsidiaries' employees, any employee of the
Company, its affiliates or any of their respective subsidiaries, or any person
who was such an employee during a one year (1) period preceding or succeeding
the Termination Date, or (b) otherwise encourage any such employee to leave his
or her employment with the Company, its affiliates or any of their respective
subsidiaries.

 

            ARTICLE 3.6                         Non-Solicitations of Others. 
During the Non-Competition Period, the Executive shall not, directly or
indirectly, (a) solicit, call on, or transact or engage in the Restricted
Business with (or attempt to do any of the foregoing with respect to) any
customer, distributor, vendor, supplier or agent with whom the Company, its
affiliates or any of their respective subsidiaries shall have dealt, or that the
Company, its affiliates or any of their respective subsidiaries shall have
actively sought to deal, at any time during a one year (1) period preceding or
succeeding Executive's Termination Date for or on behalf of the Executive or any
other person (other than the Company, its affiliates or any of their respective
subsidiaries) in connection with a Restricted Business or (b) encourage any such
customer, distributor, vendor, supplier or agent to cease, in whole or in part,
its business relationship with the Company, its affiliates or any of their
respective subsidiaries.

 

            ARTICLE 3.7             Covenants Reasonable.  The Executive
acknowledges and agrees that the covenants provided for in this Article 3 are
reasonable and necessary in terms of scope, duration, area, business and all
other matters to protect the Company's and its respective subsidiaries'
legitimate business interests, which include, among others, protecting (a)
valuable confidential business information, (b) substantial relationships with
customers throughout the Restricted Area and (c) goodwill with customers,
employees, distributors, suppliers and vendors associated with respective
businesses.

 

            ARTICLE 3.8             Construction; Enforceability.  To the extent
that any provision contained in this Article 3 may later be adjudicated by a
court to be too broad to be enforced with respect to such provision's scope,
duration, area, line of business or any other matter, such area, line of
business or other matter, as  the case may be, shall automatically be amended to
satisfy the terms of any court order so as to be valid and enforceable to the
maximum extent compatible with the applicable laws of such jurisdiction and this
Article 3 as drafted, however, such amendment is only to apply with respect to
the operation of such provision in the applicable jurisdiction in which such
adjudication is made.

 

ARTICLE 4

MISCELLANEOUS

 

            ARTICLE 4.1             Notices.  Any notice, request, demand, claim
or other communication hereunder that is required to be made in writing shall be
deemed duly given on the fifth (5th) business day after if it is sent by
registered or certified mail, return receipt requested, postage prepaid, or, on
the next business day after it is sent by a reputable overnight courier such as
Federal Express, and addressed to the intended recipient as set forth below:

If to the Executive:

To the Executive's last known address as set forth in the Company's payroll
records.

If to the Company:

Industrial Services of America, Inc.

7100 Grade Lane

Louisville, KY  40213

Attention:  Chief Financial Officer

 

            Either  party hereto may send any notice, request demand, claim or
other communication hereunder to the intended recipient at the address set forth
above using any other means (including personal delivery messenger service,
telecopy, telex, ordinary mail or electronic mail), but no such notice, request,
demand, claim or other communications shall be deemed to have been duly given
unless and until it actually is received by the intended recipient; provided,
that such communication is also sent by registered or certified mail or by
reputable overnight courier within five business days of the original
communication.  Either party hereto may change the address to which notices,
requests, demand, claims, and other communications hereunder are to be delivered
by giving the other party notice in the manner herein set forth.

 

            ARTICLE 4.2             Severability.  Whenever possible, each
provision of this Agreement will be interpreted in such manner so as to be
effective and valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability will not affect any other provision or such application in any
other jurisdiction, but this Agreement will be reformed, construed and enforced
in such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein; provided, that if any of the provisions of Article
3 are held to be invalid, illegal or unenforceable, then such provision shall be
deemed amended in the manner and to the extent provided for in Article 3.8
above.

 

            ARTICLE 4.3             Complete Agreement.  This Agreement all and
annexes attached hereto embody the complete agreement and understanding among
the parties relating to the subject matter hereof and supersedes and preempts
any prior understanding, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.

 

            ARTICLE 4.4             Counterparts.  This Agreement may be
executed in separate counterparts, each of which is deemed to be an original and
all of which taken together constitute one and the same agreement.  Any
telecopied signature shall be deemed a manually executed and delivered original.

 

            ARTICLE 4.5             Successors and Assigns.  This Agreement may
not be assigned by either the Company or the Executive, except that the Company
may assign the Agreement to a Person who purchases all or substantially all of
the assets of the Company, by merger or asset purchase or lease agreement. 
Subject to the preceding sentence, this Agreement is intended to bind and inure
to the benefit of and be enforceable by the Executive and the Company and their
respective successors and assigns (and, in the case of the Executive, heirs and
personal representatives), except that Executive may not assign any of his
rights or delegate any of his obligations hereunder.

 

            ARTICLE 4.6             Equitable Remedies.  The Executive
acknowledges and agrees that the Company would not have an adequate remedy at
law in the event any of the provisions of Article 3 set forth above are not
performed in accordance with their specific terms, or are breached or are
threatened to be breached.  Accordingly, the Executive agrees that the Company
shall be entitled, in addition to any other rights and remedies which may be
available to it, to an injunction or injunctions to prevent breaches of Article
3 above and to enforce specifically the terms and provisions thereof in any
action instituted in any court of competent jurisdiction, and without any
requirement to post a bond or other security.  In the event Company is required
to seek and is granted injunctive relief against Executive for any breach of
Article 3, Company shall be entitled to an award of reasonable attorney fees and
costs, including all those fees and costs incurred in any appeals.

 

            ARTICLE 4.7             Choice of Law:  Jurisdiction and Venue. 
This Agreement shall be governed and construed in accordance with the law of the
Commonwealth of Kentucky without regard to conflicts of laws principles thereof
and all questions concerning the validity and construction hereof shall be
determined in accordance with the law of said state.

 

            ARTICLE 4.8             Dispute Resolution.

 

            Article 4.8.1                 In consideration of the compensation
and benefits paid to Executive by the Company, the receipt and sufficiency of
which is hereby acknowledged, and for other good and valuable consideration,
Executive agrees that all legal claims or disputes arising out of or related to
Executive's employment and/or termination with the Company must be submitted to
binding arbitration and that binding arbitration will be the sole and exclusive
final remedy for resolving any such claim or dispute.  Executive also agrees
that any arbitration between the Company and Executive is of an individual claim
and that any claim subject to arbitration will not be arbitrated on a class-wide
basis.  Executive agrees that the American Arbitration Association in accordance
with its National Rules for the resolution of Employment Disputes shall
administer any arbitration between the Company and Executive and judgment on the
award rendered by the Arbitrator may be entered in any court having jurisdiction
thereof.  Such arbitration shall take place in the City of Louisville, in the
Commonwealth of Kentucky.  The Company and the Executive shall share equally in
the administrative fees for arbitration such as filing fees, hearing fees, and
hearing room rental fees.  Each of the Company and the Executive shall be
responsible for its and his legal fees and expenses, respectively.

 

            Legally protected rights covered by this Article 4.8, regarding
Dispute Resolution, are all legal claims arising out of or relating to
employment with the Company, including:  claims for wages or other compensation;
claims for breach of any contract, covenant or warranty (expressed or implied);
tort claims (including, but not limited to, claims for physical, mental or
psychological injury, but excluding statutory workers compensation claims);
claims for wrongful termination; sexual harassment; discrimination (including,
but not limited to, claims based upon race, sex, religion, national origin, age,
medical condition or disability whether under federal, state or local law);
claims for benefits or claims for damages or other remedies under any employee
benefit program sponsored by the Company (after exhausting administrative
remedies under the terms of such plans); "whistleblower" claims under any
federal, state, or other governmental law, statute,  regulation or ordinance;
and claims for retaliation under any law, statute, regulation or ordinance,
including retaliation under any worker compensation law or regulation; and
claims arising out of or relating to any employment contract (including this
Agreement), employment applications, the Company's personnel manuals or policy
statements, or any other employment agreements.

 

            Executive understands and agrees that by entering into this
Agreement, Executive anticipates gaining the benefits of a speedy, impartial
dispute resolution procedure.

 

            4.8.2   Executive understands and agrees that the Company is engaged
in transactions involving interstate commerce and the Executive's employment
involves such commerce.  Executive agrees that the Federal Arbitration Act shall
govern the interpretation, enforcement, and proceeding under this Agreement. 
Any decision of the arbitrator shall be enforceable in any federal or state
court of competent jurisdiction located in the County of Jefferson, Commonwealth
of Kentucky and each party irrevocably submits to the personal and exclusive
jurisdiction of such court.

 

            4.8.3  Executive understands and agrees that the provisions of the
Agreement are severable and, should any provision be held unenforceable, all
others will remain valid, binding and fully enforceable.  Executive agrees that
the arbitrator, and not any federal, state, or local court or agency shall have
the exclusive authority to resolve any dispute relating to the interpretation,
arbitrability, applicability, enforceability or reformation of this Agreement,
including, but not limited to, any claim that all or any part of this Agreement
is void or voidable.  If a court should determine that arbitration under this
Agreement is not the exclusive, final, and binding method for the Company and
the Executive to resolve disputes and/or that the decision and award of the
arbitrator is not final and binding as to some or all of the Executive's claims,
the Executive must submit his claim to arbitration and pursue the arbitration to
conclusion before filing or pursuing any legal, equitable, or other legal
proceeding for any eligible claim in a court of competent jurisdiction.

 

            4.8.4    This Agreement to arbitrate shall survive the termination
of Executive's employment.  It can only be revoked or modified by mutual consent
evidenced by a writing signed by both parties that specifically state their
intent to revoke or modify this Agreement.

 

            ARTICLE 4.9             Amendment and Waivers.  No provisions of
this Agreement may be amended or waived without the prior written consent of the
parties hereto.  The waiver by either party to this Agreement of a breach of any
provision of this Agreement shall not be construed to operate as a waiver of any
other breach of the same or any other term or provision or as a waiver of any
contemporaneous breach of any other term or provision or as a continuing waiver
of the same or any other term or provision.

 

            ARTICLE 4.10           Business Days.  Whenever the terms of this
Agreement call for the performance of a specific act on a specified date, which
date falls on a Saturday, Sunday or legal holiday, the date for the performance
of such act shall be postponed to the next succeeding regular business day
following such Saturday, Sunday or legal holiday.

 

            ARTICLE 4.11           No Third Party Beneficiary.  Except for the
parties to this Agreement and their respective successors and assigns, heirs and
personal representatives nothing expressed or implied in this Agreement is
intended, or will be construed, to confer upon or give any person other than the
parties hereto and their respective successors and assigns any rights or
remedies under or by reason of this Agreement.

 

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            IN WITNESS WHEREOF, the parties have executed this Agreement on the
day and year first above written.

 

EXECUTIVE

INDUSTRIAL SERVICES OF AMERICA, INC.

       

/s/ Jeffrey Valentine

By: 

/s/ Harry Kletter

JEFFREY VALENTINE

     

Title:

President

 

 

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ANNEX 1

1.  Agreement: 

 

            Shall mean the Executive Employment Agreement executed by Industrial
Services of America, Inc. and Jeffrey Valentine effective June 1, 2009, as it
may be amended from time to time, hiring Jeffrey Valentine as General Manager --
ISA Alloys in Mobile, Alabama.

 

2.  Company:

 

            Industrial Services of America, Inc., a Florida corporation, with
its principal place of business located at 7100 Grade Lane, Louisville Kentucky.

 

3.  Effective Date:

 

            June 1, 2009

 

4.  Employment Period: 

 

            June 1, 2009, until May 31, 2011, unless otherwise terminated
pursuant to the terms and conditions of the Agreement.

 

5.  Executive:

 

            Jeffrey Valentine.

 

6.  Initial Term:

 

            June 1, 2009 until May 31, 2011, unless otherwise terminated
pursuant to the terms and conditions of the Agreement.

 

7.  Incapacitation, Incapacitated, Incapacity:

 

            Shall mean that a qualified physician attending the Executive shall
have determined and provided written evidence of such determination to the
Company that said Executive is unable to attend to his personal affairs or the
business affairs of the Company on a day-to-day basis or a Court of Competent
jurisdiction determines the Executive is unable to fulfill his duties to the
Company under the Agreement.

 

8.  Notice of Termination: 

 

            A written notice from Executive (in the case of Voluntary
Termination) or Company (in the case of Termination due to Incapacity) to the
other party designating the basis for termination of Executive, the Termination
Date as provided and addressed in conformity with Articles 2.2 and 4.1 of the
Agreement.

 

9.  Renewal Term:

 

            All automatic renewals of the terms and conditions of the Agreement
on a calendar year basis, commencing on June 1, 2011 and ending May 31, 2012
continuing each 365 days thereafter until otherwise terminated by either party
in conformity with the Agreement.

 

10.  Restricted Business:

 

            Indirectly or directly, as a buyer, seller, processor, or broker of
stainless steel and high temperature alloys for the domestic and export markets
for the purpose of re-melting.  The restricted areas are within 100 miles of
Louisville, Kentucky, Mobile, Alabama, or any other locations opened or planned
to be opened by ISA  Alloys while Executive is employed.

 

11.  Termination Date:

 

            The date of termination designated in any Notice of Termination,
which shall become effective not more than thirty (30) days later if chosen by
Executive.

 

12.  Termination for Cause:

 

            Shall mean the termination of the Executive for:

            a.         Failing or refusing to follow the legal instructions or
resolutions of the Board of Directors of the Company;

            b.         Failing or refusing to follow the legal instructions of
the Chief Executive Officer or President of the Company;

            c.         Absenteeism from the Company in violation of the terms
and conditions of the Agreement;

            d.         Violation of any term or condition of this Agreement;

            e.         Violation of any securities law (federal or state) during
the term of this Agreement;

            f.          Any breach of Executive's duty of loyalty or fulfilling
duty to the Company;

            g.         Failure of the Executive to act in accordance with the
terms of the Company handbook in all material respects; or

            h.         Commission of any felony or misdemeanor involving moral
turpitude.

 

13.  Termination Without Cause:

 

            The Company's issuances of a Notice of Termination of the Executive
for any reason other than any of those bases for termination set forth in
paragraph 12, entitled Termination for Cause.

 

14.  Voluntary Termination:

 

            The Executive's issuance of a Notice of Termination to the Company
for any reason.

 

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