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                                 EXHIBIT 10.14

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                              EMPLOYMENT AGREEMENT

      AGREEMENT, made and entered into as of the 30th day of October, 1998, by
and between Metallurg, Inc., a Delaware corporation (together with its
successors and assigns permitted under this Agreement, the "Company"), and Alan
D. Ewart (the "Executive").

                              W I T N E S S E T H :

      WHEREAS, the Executive is a Joint Managing Director of London &
Scandinavian Metallurgical Co. Limited ("LSM"), a wholly owned subsidiary of the
Company incorporated under the laws of England; and

      WHEREAS, the Company and the Executive entered into an employment
agreement, dated December 21, 1983 which is currently in effect (the "Existing
Employment Agreement"); and

      WHEREAS, as of the Effective Date (as defined below), the Executive was
appointed a Chief Executive Officer of the Company; and

      WHEREAS, the Company desires to enter into a new employment agreement (the
"Agreement") embodying the terms of such employment; and

      WHEREAS, the Executive desires to enter into the Agreement and to accept
such employment, subject to the terms and provisions of the Agreement; and

      NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (individually a
"Party" and together the "Parties") agree as follows:

      1. Definitions.

            (a) "Base Salary" shall mean the Executive's base salary in
accordance with Section 4 below.

            (b) "Board" shall mean the Board of Directors of the Company.

            (c) "Business Day" shall mean any day other than a Saturday, Sunday
or any other day on which commercial banks in New York, New York are required or
authorized to be closed.

            (d) "Cause" shall mean:

                  (1)   the Executive is convicted of (or pleads nolo contendere
                        to) a felony or crime of moral turpitude, dishonesty,
                        breach of trust or unethical business conduct involving
                        the Company;

                  (2)   the Executive engages in willful misconduct, willful or
                        gross neglect, fraud, insubordination, misappropriation
                        or embezzlement to the material and demonstrable
                        detriment of the Company; or

                  (3)   the Executive breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Company specifying such breach.

            (e) "Change in Control" shall mean the first to occur of the
following events:

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                  (1)   any "person" (as such term is used in Sections 3(a)(9)
                        and 13(d) of the Exchange Act) or group of persons
                        becomes a "beneficial owner" (as such term is used in
                        Rule 13d-3 under the Exchange Act) of more than 50
                        percent of the Voting Stock of the Company;

                  (2)   the majority of the Board consists of individuals other
                        than Incumbent Directors;

                  (3)   the Company adopts any plan of liquidation providing for
                        the distribution of all or substantially all of its
                        assets;

                  (4)   the sale or other disposition of all or substantially
                        all of the assets or business of the Company and its
                        Subsidiaries taken as a whole; or

                  (5)   the merger, consolidation or combination of the Company
                        with or into another company (the "Other Company");
                        provided, however, that immediately after the merger,
                        consolidation or combination, the shareholders of the
                        Company immediately prior to the merger, consolidation
                        or combination hold, directly or indirectly, 50 percent
                        or less of the Voting Stock of the surviving company
                        (there being excluded from the number of shares held by
                        such shareholders, but not from the Voting Stock of the
                        surviving company, any shares received by any
                        "affiliate" (as such term is defined in Rule 12b-2 under
                        the Exchange Act) of the Other Company in exchange for
                        stock of the Other Company).

            (f) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, including applicable regulations thereunder.

            (g) "Competitive Activity" shall mean any activity engaged in by the
Executive, whether as an employee, principal, sole proprietor, consultant,
agent, officer, director, partner or shareholder (except as a less than
one-percent shareholder of a publicly traded company or a less than five-percent
shareholder of a privately held company), which directly competes with the
Company or any Subsidiary. For this purpose, an activity which directly competes
with the Company or any Subsidiary shall mean a business that was being
conducted by the Company or any Subsidiary during the Term of Employment.
Notwithstanding anything to the contrary in this Section 1(g), an activity shall
not be deemed to be a Competitive Activity (x) solely as a result of the
Executive's being employed by or otherwise associated with a business of which a
unit is in competition with the Company or any Subsidiary but as to which unit
the Executive does not have direct or indirect responsibilities for the products
or product lines involved or (y) if the activity contributes less than 5 percent
of the revenues for the fiscal year in question of the business by which the
Executive is employed or with which he is otherwise associated.

            (h) "Disability" shall mean a disability as determined under the
Company's long-term disability plans, programs and/or arrangements in effect on
the date such disability first occurs.

            (i) "Effective Date" shall mean August 10, 1998.

            (j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time, including applicable regulations thereunder.


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            (k) "Good Reason" shall mean the occurrence of any of the following
events:

                  (1)   the material change of the Executive's authority, duties
                        and responsibilities, or the assignment to the Executive
                        of duties materially different from the Executive's
                        position or positions with the Company;

                  (2)   a reduction in Annual Salary of the Executive;

                  (3)   the failure by the Company to obtain an agreement in
                        form and substance reasonably satisfactory to the
                        Executive from any successor to the business of the
                        Company to assume and agree to perform this Agreement;
                        or

                  (4)   the Company breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Executive specifying such breach.

            (l) "Incumbent Directors" shall mean the members of the Board as of
the Effective Date; provided, however, that any person becoming a director
subsequent to such date whose election or nomination for election was supported
by a majority of the directors who then comprised the Incumbent Directors shall
be considered to be an Incumbent Director.

            (m) "Subsidiary" of the Company shall mean any corporation of which
the Company owns, directly or indirectly, more than 50 percent of the Voting
Stock or any other business entity in which the Company directly or indirectly
has an ownership interest of more than 50 percent.

            (n) "Term of Employment" shall mean the period specified in Section
2 below.

            (o) "Voting Stock" shall mean capital stock of any class or classes
having general voting power under ordinary circumstances, in the absence of
contingencies, to elect the directors of a corporation.

      2. Term of Employment.

            The Company hereby employs the Executive, and the Executive hereby
accepts such employment, for the period commencing on the Effective Date and
ending on the second anniversary of the Effective Date (the "Term of
Employment"), subject to earlier termination of the Term of Employment in
accordance with the terms of the Agreement. The Term of Employment shall be
automatically renewed for a one-year period on the second anniversary of the
Effective Date and on each anniversary of the Effective Date thereafter, unless
either Party has notified the other Party in writing in accordance with Section
26 below at least 90 days prior to the expiration of the then Term of Employment
that he or it does not want the Term of Employment to so renew.

      3. Position, Duties and Responsibilities.

            The Executive, in his capacity as Chief Executive Officer, shall
faithfully perform for the Company the duties of said office and shall perform
such other duties of an executive, managerial or administrative nature as shall
be specified and designated from time to time by the Board consistent with such
office. The Executive shall devote substantially all of his business time and
effort to the performance of his duties hereunder. The Executive, in carrying
out his duties under this Agreement, 


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shall report to the Board. Notwithstanding anything in this Section 3 to the
contrary, nothing shall preclude the Executive from:

                  (1)   serving on the boards of directors of a reasonable
                        number of other corporations or the boards of a
                        reasonable number of trade associations and/or
                        charitable organizations;

                  (2)   engaging in charitable activities and community affairs;
                        and

                  (3)   managing his personal investments and affairs;

provided, however, that such activities do not materially interfere with the
proper performance of his duties and responsibilities hereunder.

      4. Base Salary and Consulting Fee.

            (a) From the Effective Date until the date on which the Executive
commences carrying out his duties as Chief Executive Officer from the Company's
headquarters, the Executive shall be paid an annual Base Salary, payable in
accordance with the regular payroll practices of the Company, of $320,000. From
the date on which the Executive has relocated to the United States and during
the remainder of the Term of Employment, the Executive's annual Base Salary
shall be increased to $450,000. The Base Salary may be increased (but not
decreased) at any time and from time to time by action of the Board or by any
committee thereof or any individual having authority to take such action in
accordance with the Company's regular practices. Once increased, any reference
to Base Salary herein shall be a reference to such increased amount.

            (b) During the Term of Employment, the Executive shall be paid an
annual Consulting Fee, payable in accordance with the regular payroll practices
of the Company, of $20,000. The Consulting Fee may be increased (but not
decreased) at any time and from time to time by action of the Board or by any
committee thereof or any individual having authority to take such action in
accordance with the Company's regular practices. Once increased, any reference
to Consulting Fee herein shall be a reference to such increased amount.

      5. Bonus.

            During the Term of Employment, in addition to the Base Salary, for
each fiscal year of the Company ending during the Term of Employment, the
Executive shall have the opportunity to receive an annual bonus (an "Annual
Bonus") in an amount of between 30 and 50 percent of Base Salary as of the last
day of the fiscal year of the Company, as determined by the Board. Payment of
Annual Bonus shall be made at the same time that other senior-level executives
receive their annual incentive compensation awards.

      6. Long-Term Incentive Compensation Programs.

            The Executive shall be eligible to participate in the Company's
stock option plans applicable to senior-level executives, the terms, conditions
and eligibility of such plans to be determined by the Board.


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      7. Employee Benefit Programs.

            (a) During the Term of Employment, the Executive, to the extent he
is eligible, shall be entitled to participate in those employee pension and
welfare benefit plans, programs and/or arrangements applicable to the Executive
and made available to the Company's senior-level executives or to its employees
generally, as such plans, programs and/or arrangements may be in effect from
time to time, including, without limitation, pension, profit-sharing, savings,
medical, dental, hospitalization, short-term disability, long-term disability,
life insurance, accidental death and dismemberment protection, travel accident
insurance, and other employee pension and welfare benefit plans, programs and/or
arrangements that may be sponsored by the Company from time to time.

            (b) During the Term of Employment, the Company shall provide the
Executive with term life insurance with a death benefit of at least two times
Base Salary. The Company shall pay all premiums with respect to such life
insurance. Such life insurance may be provided either through the Company's
group life insurance programs, by an individual policy, or by a combination of
both group and individual policies.

      8. Reimbursement of Business Expenses.

            The Executive is authorized to incur ordinary and reasonable
business expenses in carrying out his duties and responsibilities under the
Agreement, and the Company shall reimburse him for all such ordinary and
reasonable business expenses incurred in connection with carrying out the
business of the Company, subject to documentation in accordance with the
Company's policy. All Agreements relating to the Executive's obligation to repay
relocation expenses of the Executive previously paid by the Company shall remain
unaffected by the terms hereof.

      9. Relocation Expenses.

            The Company shall reimburse Executive, upon Executive's submission
of proof of such expenses, for the following costs of relocating from England to
the New York area: direct costs associated with (i) the sale of Executive's
current residence, including any brokers fees related thereto (excluding any
loss that may have been incurred in connection therewith), (ii) the purchase or
rental of a new residence in the New York area, including any brokers fees
related thereto (excluding the actual price of the residence), (iii) the
provision of temporary housing, for up to three months, and (iv) the actual
moving from England to the New York area.

      10. Perquisites.

            (a) During the Term of Employment, the Executive shall be entitled
to participate in the Company's executive fringe benefits applicable to the
Company's senior-level executive in accordance with the terms and conditions of
such arrangements as are in effect from time to time.

            (b) Notwithstanding anything herein to the contrary, the Company
shall pay for the membership fees (including any bond requirement) and dues at
two clubs which the Executive determines are appropriate.

            (c) During the Term of Employment, the Company shall provide a car
owned by the Company, appropriate to the position of the Executive in the
Company, to the Executive or, at the option of the Executive, the Company shall
pay for the hire by the Executive of a car for personal or business use at such
times as the Executive deems appropriate.


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      11. Vacation.

            The Executive shall be entitled to paid vacation in accordance with
the Company's vacation policy; provided, however, that the Executive shall be
entitled to not less than five weeks of vacation each year.

      12. Termination of Employment.

            (a) Termination of Employment Due to Death. In the event of the
Executive's death during the Term of Employment, the Term of Employment shall
end as of the date of the Executive's death and his estate and/or beneficiaries,
as the case may be, shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        his death;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of his death which has been earned but not paid;

                  (3)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 7, 8, 9, 10 or 11
                        above; and

                  (4)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (b) Termination of Employment Due to Disability. If the Executive's
employment is terminated due to Disability during the Term of Employment, either
by the Company or by the Executive, the Term of Employment shall end as of the
date of the Executive's termination of employment and the Executive shall be
entitled to the following (but in no event shall the Executive be entitled to
less than the benefits due him under any disability program of the Company for
which he becomes eligible):

                  (1)   Base Salary earned but not paid prior to the date of the
                        termination of the Executive's employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the sum of 50 percent of Base Salary,
                        at the annual rate in effect on the date of the
                        termination of the Executive's employment, payable in
                        monthly installments for a period ending on the first
                        day of the month following the month in which the
                        Executive attains age 65 or recovers from his
                        Disability, whichever occurs earlier, less the amount of
                        any disability benefits provided to the Executive under
                        the Company's disability program;

                  (4)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 7, 8, 9, 10 or 11
                        above;

                  (5)   continued participation, as if the Executive were still
                        an employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in those other employee plans,
                        programs and/or arrangements in which he was
                        participating on the date 


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                        of the termination of his employment until he attains
                        age 65 or recovers from his Disability, whichever occurs
                        earlier; and

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program  or  arrangement  as  provided  in  this
                              Section 12(b)(5),  he shall be provided with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(b)(5); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (6)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            If the Executive is precluded from continuing his participation in
any employee benefit plan, program or arrangement as provided in Section
12(b)(6) above, he shall be provided the after-tax economic equivalent of the
benefits provided under the plan, program or arrangement in which he is unable
to participate. The economic equivalent of any benefit foregone shall be deemed
to be the lowest cost that would be incurred by the Executive in obtaining such
benefit himself on an individual basis.

            In no event shall a termination of the Executive's employment for
Disability occur unless the Party terminating his employment gives written
notice to the other Party in accordance with Section 26 below.

            (c) Termination of Employment by the Company for Cause. A
termination of the Executive's employment by the Company for Cause shall not
take effect unless the provisions of this Section 12(c) are complied with and
the Board issues a written determination that the Executive's employment should
be terminated for Cause (a "Determination").

                  (1)   In accordance with Section 26 below, the Chairman of the
                        Board shall give the Executive a written notice stating
                        his intention to terminate the Executive's employment
                        for Cause (the "Cause Notice"). The Cause Notice shall:

                        (A)   state in detail the particular act or acts or
                              failure or failures to act that constitute the
                              grounds on which the proposed termination of
                              employment for Cause is based; and

                        (B)   be given within four months of the Chairman of the
                              Board learning of such act or acts or failure or
                              failures to act.

                  (2)   The Chairman of the Board may temporarily relieve the
                        Executive of his duties and responsibilities described
                        in Section 3 above during the period commencing on the
                        date the Cause Notice is issued by the Chairman of the
                        Board and ending on the date the Determination is issued
                        by the Board (the "Determination Period").


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                  (3)   The Executive shall have 20 days after the date the
                        Cause Notice is actually received by him in which to
                        cure his conduct on which the termination of employment
                        for Cause is based, to the extent such cure is possible.
                        If the Executive fails to cure such conduct, he shall
                        then be entitled to a hearing before the Board. Such
                        hearing shall be held during the 20-day period following
                        the date the Executive receives the Cause Notice;
                        provided, however, that the Executive requests such
                        hearing during the 10-day period following the date the
                        Executive receives the Cause Notice. Within five days
                        following the completion of such hearing, the Board
                        shall issue a Determination stating whether, in its
                        judgment, grounds for Cause as detailed in the Cause
                        Notice exist. If the Determination states that such
                        grounds exist, the Executive's employment shall be
                        immediately terminated for Cause and the Term of
                        Employment shall end as of the date of the termination
                        of the Executive's employment.

                  (4)   If the Company terminates the Executive's employment for
                        Cause, the Executive shall be entitled to the following:

                        (A)   Base Salary earned but not paid prior to the date
                              of the termination of his employment;

                        (B)   any amounts earned, accrued or owing to the
                              Executive but not yet paid under Section 6, 7, 8,
                              9, 10 or 11 above; and

                        (C)   other or additional benefits in accordance with
                              applicable plans, programs and/or arrangements of
                              the Company.

                  (5)   Notwithstanding anything herein to the contrary, if,
                        following a termination of the Executive's employment by
                        the Company for Cause based upon the conviction of the
                        Executive for a felony, such conviction is overturned in
                        a final determination on appeal, the Executive shall be
                        entitled to the payments and the economic equivalent of
                        the benefits the Executive would have received if his
                        employment had been terminated by the Company without
                        Cause.

            (d) Termination of Employment by the Company Without Cause. If the
Executive's employment is terminated by the Company without Cause, other than
due to death or Disability, the Executive shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        the termination of his employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the aggregate Base Salary (based on
                        the Base Salary in effect on the date of the termination
                        of the Executive's employment) (the "Salary Continuation
                        Benefits") with respect to a period equal to 


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                        eighteen months, payable in equal monthly installments
                        during such period;

                  (4)   continued accrual of credited service through the end of
                        the Term of Employment for the purpose of any Company
                        pension plan, program or arrangement;

                  (5)   the right to purchase, at fair market value, the
                        Executive's automobile (if any) provided to him by the
                        Company under the Company's automobile perquisite
                        program for senior-level executives;

                  (6)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 7, 8, 9, 10 or 11
                        above;

                  (7)   continued participation, as if he were still an
                        employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in other employee benefit plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until the earlier of:

                        (A)   the  end of the  period  used to  determine  the
                              Salary Continuation Benefits; or

                        (B)   the date, or dates, he receives equivalent
                              coverage and benefits under the plans, programs
                              and/or arrangements of a subsequent employer (such
                              coverage and benefits to be determined on a
                              coverage-by-coverage or benefit-by-benefit basis);

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program or  arrangement  as  provided in Section
                              12(d)(7)(A)  above,  he shall be  provided  with
                              the   after-tax   economic   equivalent  of  the
                              benefits  provided  under the plan,  program  or
                              arrangement   in   which   he   is   unable   to
                              participate  for the  period  specified  in this
                              Section 12(d)(7);

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (8)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (e) Termination of Employment by the Executive for Good Reason. The
Executive may terminate his employment for Good Reason, but only if:

                  (1)   the Executive notifies the Board during the 60-day
                        period following the date of the first occurrence of an
                        event which constitutes Good Reason (the "Good Reason
                        Event Date") of his intention to terminate his
                        employment for Good Reason;


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                  (2)   the Executive terminates his employment for Good Reason
                        during the 120-day period following the Good Reason
                        Event Date;

                  (3)   the termination of employment for Good Reason does not
                        occur during a Determination Period described in Section
                        12(c)(2) above; and

                  (4)   the Good Reason first occurs before or after a
                        Determination Period, or, if the Good Reason first
                        occurs during a Determination Period, such event
                        constituting Good Reason continues to occur after the
                        Determination Period.

Upon a termination by the Executive of his employment for Good Reason, the
Executive shall be entitled to the same payments and benefits as provided in
Section 12(d) above; provided, however, that if the Executive terminates his
employment for Good Reason based on a reduction in Base Salary under Section
1(k)(2) above, then the Base Salary to be used in determining the Salary
Continuation Benefits in accordance with Section 12(d)(2) above shall be the
Base Salary in effect immediately prior to such reduction.

            (f) Termination of Employment Following a Change in Control. If,
following a Change in Control, (i) the Executive's employment is terminated by
the Company without Cause, (ii) the Executive terminates his employment for Good
Reason, or (iii) upon prior written notice to the Company, the Executive
terminates his employment for any reason during the 60-day period following the
date of the Change in Control, the Executive shall be entitled to the same
payments and benefits as provided in Section 12(d) above, except that the Salary
Continuation Benefits under Section 12(d)(3) above shall be determined with
respect to a period equal to 18 months. A failure by the Executive to exercise
his rights with respect to a Change in Control shall not be deemed a waiver of
any rights under this Agreement.

            (g) Termination of Employment by the Executive Without Good Reason.
If the Executive terminates his employment without Good Reason, other than a
termination of employment (i) due to death or retirement or Disability or (ii)
by the Executive during the 60-day period following the date of the Change in
Control, the Executive shall have the same entitlements as provided in Section
12(c)(4) above. A termination of the Executive's employment under this Section
12(g) shall be effective upon 30 days prior written notice to the Company and
shall not be deemed a breach of this Agreement.

            (h) Non Renewal of Agreement by Company. If the Company notifies the
Executive, pursuant to Section 2 above, that it does not want the Term of
Employment to renew, the Executive shall have the same entitlements as provided
in Section 12(d) above as if the Executive had been terminated as of the last
day of the then Term of Employment.

            (i) Termination of Employment by Executive due to Relocation of
Principal Offices. In the event that the Company's principal offices are moved
outside of the States of New York, New Jersey, Connecticut, Pennsylvania,
Delaware, Maryland or the District of Columbia and such relocation is contrary
to Executive's recommendation to the Board regarding such relocation, the
Executive may terminate his employment with the Company. If the Executive
terminates his employment pursuant to this Section 12(i), he shall be entitled
an amount equal to his aggregate Base Salary (based on the Base Salary in effect
on the date of the termination of the Executive's employment) with respect to a
period equal to eighteen months, payable in equal monthly installments during
such period.

            (j) No Mitigation; No Offset. If the Executive's employment
terminates under this Section 12, the Executive shall be under no obligation to
seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration 


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attributable to any subsequent employment that he may obtain except as
specifically provided in this Section 12.

            (k) Nature of Payments. Any amounts due under this Section 12 are in
the nature of severance payments considered to be reasonable by the Company and
are not in the nature of a penalty.

      13. Confidentiality: Assignment of Rights.

            (a) During the Term of Employment and thereafter, the Executive
shall not disclose to anyone or make use of any trade secret or proprietary or
confidential information of the Company, including such trade secret or
proprietary or confidential information of any customer or other entity to which
the Company owes an obligation not to disclose such information, which he
acquires during the Term of Employment, including but not limited to records
kept in the ordinary course of business, except (i) as such disclosure or use
may be required or appropriate in connection with his work as an employee of the
Company, (ii) when required to do so by a court of law, by any governmental
agency having supervisory authority over the business of the Company or by any
administrative or legislative body (including a committee thereof) with apparent
jurisdiction to order him to divulge, disclose or make accessible such
information, or (iii) as to such confidential information that becomes generally
known to the public or trade without violation of this Section 13(a).

            (b) The Executive hereby sells, assigns and transfers to the Company
all of his right, title and interest in and to all inventions, discoveries,
improvements and copyrightable subject matter (the "rights") which during the
Term of Employment are made or conceived by him, alone or with others, and which
are within or arise out of any general field of the Company's business or arise
out of any work he performs or information he receives regarding the business of
the Company while employed by the Company. The Executive shall fully disclose to
the Company as promptly as available all information known or possessed by him
concerning the rights referred to in the preceding sentence, and upon request by
the Company and without any further remuneration in any form to him by the
Company, but at the expense of the Company, execute all applications for patents
and for copyright registration, assignments thereof and other instruments and do
all things which the Company may deem necessary to vest and maintain in it the
entire right, title and interest in and to all such rights.

      14. Noncompetition.

            (a) The Executive covenants and agrees that during the Term of
Employment and following the termination of the Executive's employment with the
Company, for a period of eighteen months, he shall not at any time, without the
prior written consent of the Company, directly or indirectly, engage in a
Competitive Activity.

            (b) The Parties acknowledge that in the event of a breach or
threatened breach of Section 14(a) above, the Company shall not have an adequate
remedy at law. Accordingly, in the event of any breach or threatened breach of
Section 14(a) above, the Company shall be entitled to such equitable and
injunctive relief as may be available to restrain the Executive and any
business, firm, partnership, individual, corporation or entity participating in
the breach or threatened breach from the violation of the provisions of Section
14(a) above. Nothing in this Agreement shall be construed as prohibiting the
Company from pursuing any other remedies available at law or in equity for
breach or threatened breach of Section 14(a) above, including the recovery of
damages.


                                       11
<PAGE>   13

      15. Indemnification.

            (a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of the
fact that he is or was a director, officer or employee of the Company or is or
was serving at the request of the Company as a director, officer, member,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to employee benefit plans,
whether or not the basis of such Proceeding is the Executive's alleged action in
an official capacity while serving as a director, officer, member, employee or
agent, the Executive shall be indemnified and held harmless by the Company to
the fullest extent legally permitted or authorized by the Company's certificate
of incorporation or bylaws or resolutions of the Company's Board of Directors
or, if greater, by the laws of the State of Delaware, against all cost, expense,
liability and loss (including, without limitation, attorney's fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Executive in connection
therewith, and such indemnification shall continue as to the Executive even if
he has ceased to be a director, member, employee or agent of the Company or
other entity and shall inure to the benefit of the Executive's heirs, executors
and administrators. The Company shall advance to the Executive all reasonable
costs and expenses incurred by him in connection with a Proceeding within 20
days after receipt by the Company of a written request for such advance. Such
request shall include an undertaking by the Executive to repay the amount of
such advance if it shall ultimately be determined that he is not entitled to be
indemnified against such costs and expenses.

            (b) Neither the failure of the Company (including the Board,
independent legal counsel or stockholders) to have made a determination prior to
the commencement of any Proceeding concerning payment of amounts claimed by the
Executive under Section 15(a) above that indemnification of the Executive is
proper because he has met the applicable standard of conduct, nor a
determination by the Company (including the Board, independent legal counsel or
stockholders) that the Executive has not met such applicable standard of
conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct.

            (c) The Company agrees to continue and maintain a directors and
officers' liability insurance policy covering the Executive to the extent the
Company provides such coverage for its other executive officers.

      16. Effect of Agreement on Other Benefits.

            Except as specifically provided in this Agreement, the existence of
this Agreement shall not prohibit or restrict the Executive's entitlement to
full participation in the Company's employee benefit plans, programs and
arrangements applicable to the Company's senior-level executives.

      17. Assignability; Binding Nature.

            This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Company; provided, however, that the
assignee or transferee is the successor to all or substantially all of the
assets of the Company and such assignee or transferee assumes the liabilities,
obligations and duties of the Company, as contained in this Agreement, either
contractually or as a matter of law. The Company further agrees that, in the
event of a sale of assets or liquidation as described in the preceding sentence,
it 


                                       12
<PAGE>   14

shall take whatever action it legally can in order to cause such assignee or
transferee to expressly assume the liabilities, obligations and duties of the
Company hereunder or under any other plan or benefit program referred to herein.
No rights or obligations of the Executive under this Agreement may be assigned
or transferred by the Executive other than his rights to compensation and
benefits, which may be transferred only by will or operation of law, except as
provided in Section 23 below.

      18. Representation.

            The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization. The Executive represents that he knows
of no agreement between him and any other person, firm or organization that
would be violated by the performance of his obligations under this Agreement.

      19. Entire Agreement.

            This Agreement contains the entire understanding and agreement
between the Parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the Parties, including, without limitation, the
Existing Employment Agreement, with respect thereto.

      20. Amendment or Waiver.

            No provision in this Agreement may be amended unless such amendment
is agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be.

      21. Severability.

            In the event that any provision or portion of this Agreement shall
be determined to be invalid or unenforceable for any reason, in whole or in
part, the remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect and such provision or portion of this
Agreement shall remain in effect to the fullest extent permitted by law.

      22. Survivorship.

            The respective rights and obligations of the Parties hereunder shall
survive any termination of the Executive's employment to the extent necessary to
the intended preservation of such rights and obligations.

      23. Beneficiaries/References.

            The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of his incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative.


                                       13
<PAGE>   15

      24. Governing Law/Submission to Jurisdiction.

            This Agreement shall be governed by and construed and interpreted in
accordance with the laws of New York without reference to principles of conflict
of laws. Each of the Company and the Executive hereby irrevocably and
unconditionally: (i) submits for itself or himself, as applicable, and its or
his property in any legal action or proceeding relating to this Agreement, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof; (ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection that it or he
may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an inconvenient
forum and agrees not to plead or claim the same; (iii) agrees that service of
process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to its or his address set forth in or designated
pursuant to Section 26 hereof; and (iv) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.

      25. Resolution of Disputes.

            Any disputes arising under or in connection with the Agreement,
other than disputes arising in connection with Sections 13 and 14 hereof, may,
at the election of the Executive or the Company, be resolved by binding
arbitration, to be held in New York City in accordance with the rules and
procedures of the American Arbitration Association. If arbitration is elected,
the Executive and the Company shall mutually select the arbitrator. If the
Executive and the Company cannot agree on the selection of an arbitrator, each
Party shall select an arbitrator and the two arbitrators shall select a third
arbitrator, and the three arbitrators shall form an arbitration panel which
shall resolve the dispute by majority vote. Judgment upon the award rendered by
the arbitrator(s) may be entered in any court having jurisdiction thereof. Costs
of the arbitration or litigation, including, without limitation, reasonable
attorneys' fees of both Parties, shall be borne by the Company; provided,
however, that if a dispute is resolved in favor of the Company, the Executive
shall bear his own costs of the arbitration or litigation and shall reimburse
the Company for the Executive's cost of the arbitration or litigation previously
paid by the Company. Pending the resolution of any arbitration or court
proceeding, the Company shall continue payment of all amounts due the Executive
under this Agreement and all benefits to which the Executive is entitled at the
time the dispute arises.

      26. Notices.

            Any notice given to a Party shall be in writing and shall be deemed
to have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the Party
concerned at the address indicated below or to such changed address as such
Party may subsequently give such notice of:

If to the Company:            Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017
                              Attention: General Counsel

With a copy to:               Rogers & Wells LLP
                              200 Park Avenue


                                       14
<PAGE>   16

                              New York, New York 10166
                              Attention: Samuel M. Feder

If to the Executive:          Alan D. Ewart
                              c/o Metallurg, Inc.
                              6 East 43rd Street, 12th Floor
                              New York, New York 10017

      27. Headings.

            The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

      28. Counterparts.

            This Agreement may be executed in two or more counterparts.


                                       15
<PAGE>   17

      IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

                                    METALLURG, INC.

                                    By: /s/ Heinz C. Schimmelbusch
                                        ----------------------------------------
                                        Name: Heinz C. Schimmelbusch
                                        Title: Chairman

                                    /s/ Alan D. Ewart
                                    --------------------------------------------
                                    Alan D. Ewart


                                       16
<PAGE>   18

                              EMPLOYMENT AGREEMENT

      AGREEMENT, made and entered into as of the 19th day of November, 1998, by
and between Metallurg, Inc., a Delaware corporation (together with its
successors and assigns permitted under this Agreement, the "Company"), and Eric
E. Jackson (the "Executive").

                              W I T N E S S E T H :

      WHEREAS, prior to the Effective Date (as defined below), the Executive was
the President of Shieldalloy Metallurgical Corporation, a wholly-owned
subsidiary of the Company; and

      WHEREAS, the Company and the Executive entered into an employment
agreement, dated December 31, 1997 which is currently in effect (the "Existing
Employment Agreement"); and

      WHEREAS, as of the Effective Date, the Executive was appointed a Senior
Vice President and the Chief Operating Officer of the Company; and

      WHEREAS, the Company desires to enter into a new employment agreement (the
"Agreement") embodying the terms of such employment; and

      WHEREAS, the Executive desires to enter into the Agreement and to accept
such employment, subject to the terms and provisions of the Agreement; and

      WHEREAS, the Company and the Executive desire to cancel the Existing
Employment Agreement as of the Effective Date;

      NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (individually a
"Party" and together the "Parties") agree as follows:

      1. Definitions.

            (a) "Base Salary" shall mean the Executive's base salary in
accordance with Section 4 below.

            (b) "Board" shall mean the Board of Directors of the Company.

            (c) "Business Day" shall mean any day other than a Saturday, Sunday
or any other day on which commercial banks in New York, New York are required or
authorized to be closed.

            (d) "Cause" shall mean:

                  (1)   the Executive is convicted of (or pleads nolo contendere
                        to) a felony or a crime of moral turpitude, dishonesty,
                        breach of trust or unethical business conduct involving
                        the Company;

                  (2)   the Executive engages in willful misconduct, willful or
                        gross neglect, fraud, insubordination, misappropriation
                        or embezzlement to the material and demonstrable
                        detriment of the Company; or

                  (3)   the Executive breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Company specifying such breach.

<PAGE>   19

            (e) "CEO" shall mean the chief executive officer of the Company.

            (f) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, including applicable regulations thereunder.

            (g) "Competitive Activity" shall mean any activity engaged in by the
Executive, whether as an employee, principal, sole proprietor, consultant,
agent, officer, director, partner or shareholder (except as a less than
one-percent shareholder of a publicly traded company or a less than five-percent
shareholder of a privately held company), which directly competes with the
Company or any Subsidiary. For this purpose, an activity which directly competes
with the Company or any Subsidiary shall mean a business that was being
conducted by the Company or any Subsidiary during the Term of Employment.
Notwithstanding anything to the contrary in this Section 1(g), an activity shall
not be deemed to be a Competitive Activity (x) solely as a result of the
Executive's being employed by or otherwise associated with a business of which a
unit is in competition with the Company or any Subsidiary but as to which unit
the Executive does not have direct or indirect responsibilities for the products
or product lines involved or (y) if the activity contributes less than 5 percent
of the revenues for the fiscal year in question of the business by which the
Executive is employed or with which he is otherwise associated.

            (h) "Disability" shall mean a disability as determined under the
Company's long-term disability plans, programs and/or arrangements in effect on
the date such disability first occurs.

            (i) "Effective Date" shall mean August 10, 1998.

            (j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time, including applicable regulations thereunder.

            (k) "Good Reason" shall mean the occurrence of any of the following
events:

                  (1)   the material change of the Executive's authority, duties
                        and responsibilities, or the assignment to the Executive
                        of duties materially different from the Executive's
                        position or positions with the Company;

                  (2)   a reduction in Base Salary of the Executive;

                  (3)   the failure by the Company to obtain an agreement in
                        form and substance reasonably satisfactory to the
                        Executive from any successor to the business of the
                        Company to assume and agree to perform this Agreement;
                        or

                  (4)   the Company breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Executive specifying such breach.

            (l) "Subsidiary" of the Company shall mean any corporation of which
the Company owns, directly or indirectly, more than 50 percent of the Voting
Stock or any other business entity in which the Company directly or indirectly
has an ownership interest of more than 50 percent.

            (m) "Term of Employment" shall mean the period specified in Section
2 below.


                                       2
<PAGE>   20

            (n) "Voting Stock" shall mean capital stock of any class or classes
having general voting power under ordinary circumstances, in the absence of
contingencies, to elect the directors of a corporation.

      2. Term of Employment.

            The Company hereby employs the Executive, and the Executive hereby
accepts such employment, for the period commencing on the Effective Date and
ending on the second anniversary of the Effective Date (the "Term of
Employment"), subject to earlier termination of the Term of Employment in
accordance with the terms of the Agreement. The Term of Employment shall be
automatically renewed for a one-year period on the second anniversary of the
Effective Date and on each anniversary of the Effective Date thereafter, unless
either Party has notified the other Party in writing in accordance with Section
26 below at least 90 days prior to the expiration of the then Term of Employment
that he or it does not want the Term of Employment to so renew.

      3. Position, Duties and Responsibilities.

            The Executive, in his capacity as a Senior Vice President and Chief
Operating Officer, shall faithfully perform for the Company the duties of said
office and shall perform such other duties of an executive, managerial or
administrative nature as shall be specified and designated from time to time by
the CEO consistent with such office. The Executive shall devote substantially
all of his business time and effort to the performance of his duties hereunder.
The Executive, in carrying out his duties under this Agreement, shall report to
the CEO. Notwithstanding anything in this Section 3 to the contrary, nothing
shall preclude the Executive from:

                  (1)   serving on the boards of directors of a reasonable
                        number of other corporations or the boards of a
                        reasonable number of trade associations and/or
                        charitable organizations;

                  (2)   engaging in charitable activities and community affairs;
                        and

                  (3)   managing his personal investments and affairs;

provided, however, that such activities do not materially interfere with the
proper performance of his duties and responsibilities hereunder.

      4. Base Salary.

            During the Term of Employment, the Executive shall be paid an annual
Base Salary, payable in accordance with the regular payroll practices of the
Company, of $280,000. The Base Salary may be increased (but not decreased) at
any time and from time to time by action of the Board or by any committee
thereof or any individual having authority to take such action in accordance
with the Company's regular practices. Once increased, any reference to Base
Salary herein shall be a reference to such increased amount.

      5. Bonus.

            During the Term of Employment, in addition to the Base Salary, for
each fiscal year of the Company ending during the Term of Employment, the
Executive shall have the opportunity to receive an annual bonus (an "Annual
Bonus") in an amount of between 30 and 50 percent of Base Salary, as determined
by the CEO, in consultation with the Chairman of the Board. Payment of Annual
Bonus shall 


                                       3
<PAGE>   21

be made at the same time that other senior-level executives receive their annual
incentive compensation awards.

      6. Long-Term Incentive Compensation Programs.

            The Executive shall be eligible to participate in the Company's
stock option plans applicable to senior-level executives, the terms, conditions
and eligibility of such plans to be determined by the Board.

      7. Employee Benefit Programs.

            (a) During the Term of Employment, the Executive, to the extent he
is eligible, shall be entitled to participate in those employee pension and
welfare benefit plans, programs and/or arrangements applicable to the Executive
and made available to the Company's senior-level executives or to its employees
generally, as such plans, programs and/or arrangements may be in effect from
time to time, including, without limitation, pension, profit-sharing, savings,
medical, dental, hospitalization, short-term disability, long-term disability,
life insurance, accidental death and dismemberment protection, travel accident
insurance, and other employee pension and welfare benefit plans, programs and/or
arrangements that may be sponsored by the Company from time to time.

            (b) During the Term of Employment, the Company shall provide the
Executive with term life insurance with a death benefit of at least two times
Base Salary. The Company shall pay all premiums with respect to such life
insurance. Such life insurance may be provided either through the Company's
group life insurance programs, by an individual policy, or by a combination of
both group and individual policies.

      8. Reimbursement of Business Expenses.

            The Executive is authorized to incur ordinary and reasonable
business expenses in carrying out his duties and responsibilities under the
Agreement, and the Company shall reimburse him for all such ordinary and
reasonable business expenses incurred in connection with carrying out the
business of the Company, subject to documentation in accordance with the
Company's policy. All Agreements relating to the Executive's obligation to repay
relocation expenses of the Executive previously paid by the Company shall remain
unaffected by the terms hereof.

      9. Relocation Expenses.

            The Company shall reimburse Executive, upon Executive's submission
of proof of such expenses, for the following costs of relocating from
Moorestown, New Jersey to the New York metropolitan area: direct costs
associated with (i) the sale of Executive's current residence (excluding any
loss that may have been incurred in connection therewith), (ii) the purchase of
a new residence in the New York metropolitan area (excluding the actual price of
the residence), (iii) the provision of temporary housing, for up to three
months, and (iv) the actual moving from Moorestown, New Jersey to the New York
metropolitan area.

      10. Perquisites.

            (a) During the Term of Employment, the Executive shall be entitled
to participate in the Company's executive fringe benefits applicable to the
Company's senior-level executive in accordance with the terms and conditions of
such arrangements as are in effect from time to time.


                                       4
<PAGE>   22

            (b) Notwithstanding anything herein to the contrary, the Company
shall pay for the membership fees (including any bond requirement) and dues at
one club which the Executive determines is appropriate.

            (c) During the Term of Employment, the Company shall provide a car
to the Executive.

      11. Vacation.

            The Executive shall be entitled to paid vacation in accordance with
the Company's vacation policy; provided, however, that the Executive shall be
entitled to not less than four weeks of vacation each year.

      12. Termination of Employment.

            (a) Termination of Employment Due to Death. In the event of the
Executive's death during the Term of Employment, the Term of Employment shall
end as of the date of the Executive's death and his estate and/or beneficiaries,
as the case may be, shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        his death;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of his death which has been earned but not paid;

                  (3)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 7, 8, 9, 10 or 11
                        above; and

                  (4)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (b) Termination of Employment Due to Disability. If the Executive's
employment is terminated due to Disability during the Term of Employment, either
by the Company or by the Executive, the Term of Employment shall end as of the
date of the Executive's termination of employment and the Executive shall be
entitled to the following (but in no event shall the Executive be entitled to
less than the benefits due him under any disability program of the Company for
which he becomes eligible):

                  (1)   Base Salary earned but not paid prior to the date of the
                        termination of the Executive's employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the sum of 50 percent of Base Salary,
                        at the annual rate in effect on the date of the
                        termination of the Executive's employment, payable in
                        monthly installments for a period ending on the first
                        day of the month following the month in which the
                        Executive attains age 65 or recovers from his
                        Disability, whichever occurs earlier, less the amount of
                        any disability benefits provided to the Executive under
                        the Company's disability program;


                                       5
<PAGE>   23

                  (4)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 7, 8, 9, 10 or 11
                        above;

                  (5)   continued participation, as if the Executive were still
                        an employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in those other employee plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until he attains age 65 or recovers from his
                        Disability, whichever occurs earlier; `

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program  or  arrangement  as  provided  in  this
                              Section 12(b)(5),  he shall be provided with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(b)(5); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (6)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            In no event shall a termination of the Executive's employment for
Disability occur unless the Party terminating his employment gives written
notice to the other Party in accordance with Section 26 below.

            (c) Termination of Employment by the Company for Cause. A
termination of the Executive's employment by the Company for Cause shall not
take effect unless the provisions of this Section 12(c) are complied with and
the Board issues a written determination that the Executive's employment should
be terminated for Cause (a "Determination").

                  (1)   In accordance with Section 26 below, the CEO shall give
                        the Executive a written notice stating his intention to
                        terminate the Executive's employment for Cause (the
                        "Cause Notice"). The Cause Notice shall:

                        (A)   state in detail the particular act or acts or
                              failure or failures to act that constitute the
                              grounds on which the proposed termination of
                              employment for Cause is based; and

                        (B)   be given within four months of the CEO learning of
                              such act or acts or failure or failures to act.

                  (2)   The CEO may temporarily relieve the Executive of his
                        duties and responsibilities described in Section 3 above
                        during the period commencing on the date the Cause
                        Notice is issued by the CEO and ending on the date the
                        Determination is issued by the Board (the "Determination
                        Period").


                                       6
<PAGE>   24

                  (3)   The Executive shall have 20 days after the date the
                        Cause Notice is actually received by him in which to
                        cure his conduct on which the termination of employment
                        for Cause is based, to the extent such cure is possible.
                        If the Executive fails to cure such conduct, he shall
                        then be entitled to a hearing before the Board. Such
                        hearing shall be held during the 20-day period following
                        the date the Executive receives the Cause Notice;
                        provided, however, that the Executive requests such
                        hearing during the 10-day period following the date the
                        Executive receives the Cause Notice. Within five days
                        following the completion of such hearing, the Board
                        shall issue a Determination stating whether, in its
                        judgment, grounds for Cause as detailed in the Cause
                        Notice exist. If the Determination states that such
                        grounds exist, the Executive's employment shall be
                        immediately terminated for Cause and the Term of
                        Employment shall end as of the date of the termination
                        of the Executive's employment.

                  (4)   If the Company terminates the Executive's employment for
                        Cause, the Executive shall be entitled to the following:

                        (A)   Base Salary earned but not paid prior to the
                              date of the termination of his employment;

                        (B)   any amounts earned, accrued or owing to the
                              Executive but not yet paid under Section 6, 7, 8,
                              9, 10 or 11 above; and

                        (C)   other or additional benefits in accordance with
                              applicable plans, programs and/or arrangements of
                              the Company.

                  (5)   Notwithstanding anything herein to the contrary, if,
                        following a termination of the Executive's employment by
                        the Company for Cause based upon the conviction of the
                        Executive for a felony, such conviction is overturned in
                        a final determination on appeal, the Executive shall be
                        entitled to the payments and the economic equivalent of
                        the benefits the Executive would have received if his
                        employment had been terminated by the Company without
                        Cause.

            (d) Termination of Employment by the Company Without Cause. If the
Executive's employment is terminated by the Company without Cause, other than
due to death or Disability, the Executive shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        the termination of his employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the aggregate Base Salary (based on
                        the Base Salary in effect on the date of the termination
                        of the Executive's employment) (the "Salary Continuation
                        Benefits") with respect to a period equal to 


                                       7
<PAGE>   25

                        eighteen months, payable in equal monthly installments
                        over such period;

                  (4)   continued accrual of credited service through the end of
                        the Term of Employment for the purpose of any Company
                        pension plan, program or arrangement;

                  (5)   the right to purchase, at fair market value, the
                        Executive's automobile (if any) provided to him by the
                        Company under the Company's automobile perquisite
                        program for senior-level executives;

                  (6)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 7, 8, 9, 10 or 11
                        above;

                  (7)   continued participation, as if he were still an
                        employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in other employee benefit plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until the earlier of:

                        (A)   the  end of the  period  used to  determine  the
                              Salary Continuation Benefits; or

                        (B)   the date, or dates, he receives equivalent
                              coverage and benefits under the plans, programs
                              and/or arrangements of a subsequent employer (such
                              coverage and benefits to be determined on a
                              coverage-by-coverage or benefit-by-benefit basis);

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program or  arrangement  as  provided in Section
                              12(d)(7)  above,  he shall be provided  with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(d)(7); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (8)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (e) Termination of Employment by the Executive for Good Reason. The
Executive may terminate his employment for Good Reason, but only if:

                  (1)   the Executive notifies the Board during the 60-day
                        period following the date of the first occurrence of an
                        event which constitutes Good Reason (the "Good Reason
                        Event Date") of his intention to terminate his
                        employment for Good Reason;


                                       8
<PAGE>   26

                  (2)   the Executive terminates his employment for Good Reason
                        during the 120-day period following the Good Reason
                        Event Date;

                  (3)   the termination of employment for Good Reason does not
                        occur during a Determination Period described in Section
                        12(c)(2) above; and

                  (4)   the Good Reason first occurs before or after a
                        Determination Period, or, if the Good Reason first
                        occurs during a Determination Period, such event
                        constituting Good Reason continues to occur after the
                        Determination Period.

Upon a termination by the Executive of his employment for Good Reason, the
Executive shall be entitled to the same payments and benefits as provided in
Section 12(d) above; provided, however, that if the Executive terminates his
employment for Good Reason based on a reduction in Base Salary under Section
1(k)(2) above, then the Base Salary to be used in determining the Salary
Continuation Benefits in accordance with Section 12(d)(3) above shall be the
Base Salary in effect immediately prior to such reduction.

            (f) Termination of Employment by the Executive Without Good Reason.
If the Executive terminates his employment without Good Reason, other than a
termination of employment due to death or retirement or Disability, the
Executive shall have the same entitlements as provided in Section 12(c)(4)
above. A termination of the Executive's employment under this Section 12(f)
shall be effective upon 30 days prior written notice to the Company and shall
not be deemed a breach of this Agreement.

            (g) Non Renewal of Agreement by Company. If the Company notifies the
Executive, pursuant to Section 2 above, that it does not want the Term of
Employment to renew, the Executive shall have the same entitlements as provided
in Section 12(d) above as if the Executive had been terminated without cause as
of the last day of the then Term of Employment.

            (h) Termination of Employment by Executive due to Relocation of Work
Location. In the event that the Executive's principal work location is moved
outside of the States of New York, New Jersey, Connecticut, Pennsylvania,
Delaware, Maryland or the District of Columbia, the Executive may terminate his
employment with the Company. If the Executive terminates his employment pursuant
to this Section 12(h), he shall have the same entitlements as provided in
Section 12(d) above; provided, that all such benefits, including, without
limitation, the Salary Continuation Benefits, shall be provided for a period
equal to the corresponding severance period listed on Schedule A, payable in
equal monthly installments during such period.

            (i) No Mitigation; No Offset. If the Executive's employment
terminates under this Section 12, the Executive shall be under no obligation to
seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that he may obtain except as specifically provided in
this Section 12.

            (j) Nature of Payments. Any amounts due under this Section 12 are in
the nature of severance payments considered to be reasonable by the Company and
are not in the nature of a penalty.

      13. Confidentiality: Assignment of Rights.

            (a) During the Term of Employment and thereafter, the Executive
shall not disclose to anyone or make use of any trade secret or proprietary or
confidential information of the Company, 


                                       9
<PAGE>   27

including such trade secret or proprietary or confidential information of any
customer or other entity to which the Company owes an obligation not to disclose
such information, which he acquires during the Term of Employment, including but
not limited to records kept in the ordinary course of business, except (i) as
such disclosure or use may be required or appropriate in connection with his
work as an employee of the Company, (ii) when required to do so by a court of
law, by any governmental agency having supervisory authority over the business
of the Company or by any administrative or legislative body (including a
committee thereof) with apparent jurisdiction to order him to divulge, disclose
or make accessible such information, or (iii) as to such confidential
information that becomes generally known to the public or trade without
violation of this Section 13(a).

            (b) The Executive hereby sells, assigns and transfers to the Company
all of his right, title and interest in and to all inventions, discoveries,
improvements and copyrightable subject matter (the "rights") which during the
Term of Employment are made or conceived by him, alone or with others, and which
are within or arise out of any general field of the Company's business or arise
out of any work he performs or information he receives regarding the business of
the Company while employed by the Company. The Executive shall fully disclose to
the Company as promptly as available all information known or possessed by him
concerning the rights referred to in the preceding sentence, and upon request by
the Company and without any further remuneration in any form to him by the
Company, but at the expense of the Company, execute all applications for patents
and for copyright registration, assignments thereof and other instruments and do
all things which the Company may deem necessary to vest and maintain in it the
entire right, title and interest in and to all such rights.

      14. Noncompetition.

            (a) The Executive covenants and agrees that during the Term of
Employment and following the termination of the Executive's employment with the
Company, for a period of eighteen months or, in the case of a termination
pursuant to Section 12(h), a period equal to the shorter of (i) twice the
corresponding severance period listed on Schedule A and (ii) eighteen months, he
shall not at any time, without the prior written consent of the Company,
directly or indirectly, engage in a Competitive Activity.

            (b) The Parties acknowledge that in the event of a breach or
threatened breach of Section 14(a) above, the Company shall not have an adequate
remedy at law. Accordingly, in the event of any breach or threatened breach of
Section 14(a) above, the Company shall be entitled to such equitable and
injunctive relief as may be available to restrain the Executive and any
business, firm, partnership, individual, corporation or entity participating in
the breach or threatened breach from the violation of the provisions of Section
14(a) above. Nothing in this Agreement shall be construed as prohibiting the
Company from pursuing any other remedies available at law or in equity for
breach or threatened breach of Section 14(a) above, including the recovery of
damages.

      15. Indemnification.

            (a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of the
fact that he is or was a director, officer or employee of the Company or is or
was serving at the request of the Company as a director, officer, member,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to employee benefit plans,
whether or not the basis of such Proceeding is the Executive's alleged action in
an official capacity while serving as a director, officer, member, employee or
agent, the Executive shall be indemnified and held harmless by the Company to
the fullest extent legally permitted or authorized by the Company's certificate
of incorporation or bylaws or resolutions of the Company's Board of Directors


                                       10
<PAGE>   28

or, if greater, by the laws of the State of Delaware, against all cost, expense,
liability and loss (including, without limitation, attorney's fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Executive in connection
therewith, and such indemnification shall continue as to the Executive even if
he has ceased to be a director, member, employee or agent of the Company or
other entity and shall inure to the benefit of the Executive's heirs, executors
and administrators. The Company shall advance to the Executive all reasonable
costs and expenses incurred by him in connection with a Proceeding within 20
days after receipt by the Company of a written request for such advance. Such
request shall include an undertaking by the Executive to repay the amount of
such advance if it shall ultimately be determined that he is not entitled to be
indemnified against such costs and expenses.

            (b) Neither the failure of the Company (including the Board,
independent legal counsel or stockholders) to have made a determination prior to
the commencement of any Proceeding concerning payment of amounts claimed by the
Executive under Section 15(a) above that indemnification of the Executive is
proper because he has met the applicable standard of conduct, nor a
determination by the Company (including the Board, independent legal counsel or
stockholders) that the Executive has not met such applicable standard of
conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct.

            (c) The Company agrees to continue and maintain a directors and
officers' liability insurance policy covering the Executive to the extent the
Company provides such coverage for its other executive officers.

      16. Effect of Agreement on Other Benefits.

            Except as specifically provided in this Agreement, the existence of
this Agreement shall not prohibit or restrict the Executive's entitlement to
full participation in the Company's employee benefit plans, programs and
arrangements applicable to the Company's senior-level executives.

      17. Assignability; Binding Nature.

            This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Company; provided, however, that the
assignee or transferee is the successor to all or substantially all of the
assets of the Company and such assignee or transferee assumes the liabilities,
obligations and duties of the Company, as contained in this Agreement, either
contractually or as a matter of law. The Company further agrees that, in the
event of a sale of assets or liquidation as described in the preceding sentence,
it shall take whatever action it legally can in order to cause such assignee or
transferee to expressly assume the liabilities, obligations and duties of the
Company hereunder or under any other plan or benefit program referred to herein.
No rights or obligations of the Executive under this Agreement may be assigned
or transferred by the Executive other than his rights to compensation and
benefits, which may be transferred only by will or operation of law, except as
provided in Section 23 below.

      18. Representation.

            The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization. The Executive represents that he knows


                                       11
<PAGE>   29

of no agreement between him and any other person, firm or organization that
would be violated by the performance of his obligations under this Agreement.

      19. Entire Agreement.

            This Agreement contains the entire understanding and agreement
between the Parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the Parties, including, without limitation, the
Existing Employment Agreement, with respect thereto.

      20. Amendment or Waiver.

            No provision in this Agreement may be amended unless such amendment
is agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be.

      21. Severability.

            In the event that any provision or portion of this Agreement shall
be determined to be invalid or unenforceable for any reason, in whole or in
part, the remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect and such provision or portion of this
Agreement shall remain in effect to the fullest extent permitted by law.

      22. Survivorship.

            The respective rights and obligations of the Parties hereunder shall
survive any termination of the Executive's employment to the extent necessary to
the intended preservation of such rights and obligations.

      23. Beneficiaries/References.

            The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of his incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative.

      24. Governing Law/Submission to Jurisdiction.

            This Agreement shall be governed by and construed and interpreted in
accordance with the laws of New York without reference to principles of conflict
of laws. Each of the Company and the Executive hereby irrevocably and
unconditionally: (i) submits for itself or himself, as applicable, and its or
his property in any legal action or proceeding relating to this Agreement, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof; (ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection that it or he
may now or hereafter have to the venue of any such 


                                       12
<PAGE>   30

action or proceeding in any such court or that such action or proceeding was
brought in an inconvenient forum and agrees not to plead or claim the same;
(iii) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to its or his address set
forth in or designated pursuant to Section 26 hereof; and (iv) agrees that
nothing herein shall affect the right to effect service of process in any other
manner permitted by law or shall limit the right to sue in any other
jurisdiction.

            25. Resolution of Disputes.

            Any disputes arising under or in connection with the Agreement,
other than disputes arising in connection with Sections 13 and 14 hereof, may,
at the election of the Executive or the Company, be resolved by binding
arbitration, to be held in New York City in accordance with the rules and
procedures of the American Arbitration Association. If arbitration is elected,
the Executive and the Company shall mutually select the arbitrator. If the
Executive and the Company cannot agree on the selection of an arbitrator, each
Party shall select an arbitrator and the two arbitrators shall select a third
arbitrator, and the three arbitrators shall form an arbitration panel which
shall resolve the dispute by majority vote. Judgment upon the award rendered by
the arbitrator(s) may be entered in any court having jurisdiction thereof. Costs
of the arbitration or litigation, including, without limitation, reasonable
attorneys' fees of both Parties, shall be borne by the Company; provided,
however, that, if a dispute is resolved in favor of the Company, the Executive
shall bear his own costs of the arbitration or litigation and shall reimburse
the Company for the Executive's costs of the arbitration or litigation
previously paid by the Company. Pending the resolution of any arbitration or
court proceeding, the Company shall continue payment of all amounts due the
Executive under this Agreement and all benefits to which the Executive is
entitled at the time the dispute arises.

            26. Notices.

            Any notice given to a Party shall be in writing and shall be deemed
to have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the Party
concerned at the address indicated below or to such changed address as such
Party may subsequently give such notice of:

If to the Company:            Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017
                              Attention: General Counsel

With a copy to:               Rogers & Wells LLP
                              200 Park Avenue
                              New York, New York 10166
                              Attention: Samuel M. Feder

If to the Executive:          Eric E. Jackson
                              c/o Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017


                                       13
<PAGE>   31

      27. Headings.

            The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

      28. Counterparts.

            This Agreement may be executed in two or more counterparts.

      IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

                                    METALLURG, INC.

                                    By: /s/ Alan D. Ewart
                                        ----------------------------------------
                                        Name: Alan D. Ewart
                                        Title: President and CEO

                                       /s/ Eric E. Jackson
                                        ----------------------------------------
                                       Eric E. Jackson


                                       14
<PAGE>   32

                                   SCHEDULE A

<TABLE>
<CAPTION>
            Years of Service                    Severance Period
            ----------------                    ----------------
            <S>                                 <C> 
            Up To 15                            6 months

            More Than 15                        9 months

            More Than 20                        12 months
</TABLE>


                                       15
<PAGE>   33

                              EMPLOYMENT AGREEMENT

      AGREEMENT, made and entered into as of the 19th day of November, 1998, by
and between Metallurg, Inc., a Delaware corporation (together with its
successors and assigns permitted under this Agreement, the "Company"), and Robin
Brumwell (the "Executive").

                              W I T N E S S E T H :

      WHEREAS, the Executive is the President of Metallurg International
Resources ("MIR"), a division of the Company; and

      WHEREAS, the Company and the Executive entered into an employment
agreement, dated April 14, 1997 which is currently in effect (the "Existing
Employment Agreement"); and

      WHEREAS, as of the Effective Date (as defined below), the Executive, in
addition to his existing position, was appointed as a Senior Vice President of
the Company; and

      WHEREAS, the Company desires to enter into a new employment agreement (the
"Agreement") embodying the terms of such employment; and

      WHEREAS, the Executive desires to enter into the Agreement and to accept
such employment, subject to the terms and provisions of the Agreement; and

      WHEREAS,  the Company and the  Executive  desire to cancel the  Existing
Employment Agreement as of the Effective Date;

      NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (individually a
"Party" and together the "Parties") agree as follows:

      1. Definitions.

            (a) "Base Salary" shall mean the Executive's base salary in
accordance with Section 4 below.

            (b) "Board" shall mean the Board of Directors of the Company.

            (c) "Business Day" shall mean any day other than a Saturday, Sunday
or any other day on which commercial banks in New York, New York are required or
authorized to be closed.

            (d) "Cause" shall mean:

                  (1)   the Executive is convicted of (or pleads nolo contendere
                        to) a felony or a crime of moral turpitude, dishonesty,
                        breach of trust or unethical business conduct involving
                        the Company;

                  (2)   the Executive engages in willful misconduct, willful or
                        gross neglect, fraud, insubordination, misappropriation
                        or embezzlement to the material and demonstrable
                        detriment of the Company; or

                  (3)   the Executive breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Company specifying such breach.

<PAGE>   34

            (e) "CEO" shall mean the chief executive officer of the Company.

            (f) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, including applicable regulations thereunder.

            (g) "Competitive Activity" shall mean any activity engaged in by the
Executive, whether as an employee, principal, sole proprietor, consultant,
agent, officer, director, partner or shareholder (except as a less than
one-percent shareholder of a publicly traded company or a less than five-percent
shareholder of a privately held company), which directly competes with the
Company or any Subsidiary. For this purpose, an activity which directly competes
with the Company or any Subsidiary shall mean a business that was being
conducted by the Company or any Subsidiary during the Term of Employment.
Notwithstanding anything to the contrary in this Section 1(g), an activity shall
not be deemed to be a Competitive Activity (x) solely as a result of the
Executive's being employed by or otherwise associated with a business of which a
unit is in competition with the Company or any Subsidiary but as to which unit
the Executive does not have direct or indirect responsibilities for the products
or product lines involved or (y) if the activity contributes less than 5 percent
of the revenues for the fiscal year in question of the business by which the
Executive is employed or with which he is otherwise associated.

            (h) "Disability" shall mean a disability as determined under the
Company's long-term disability plans, programs and/or arrangements in effect on
the date such disability first occurs.

            (i) "Effective Date" shall mean August 10, 1998.

            (j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time, including applicable regulations thereunder.

            (k) "Good Reason" shall mean the occurrence of any of the following
events:

                  (1)   the material change of the Executive's authority, duties
                        and responsibilities, or the assignment to the Executive
                        of duties materially different from the Executive's
                        position or positions with the Company;

                  (2)   a reduction in Base Salary of the Executive;

                  (3)   the failure by the Company to obtain an agreement in
                        form and substance reasonably satisfactory to the
                        Executive from any successor to the business of the
                        Company to assume and agree to perform this Agreement;
                        or

                  (4)   the Company breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Executive specifying such breach.

            (l) "Subsidiary" of the Company shall mean any corporation of which
the Company owns, directly or indirectly, more than 50 percent of the Voting
Stock or any other business entity in which the Company directly or indirectly
has an ownership interest of more than 50 percent.

            (m) "Tax Loans" shall mean all of the outstanding loans made by the
Company to the Executive pursuant to Section 6(c) of the Existing Employment
Agreement in respect of federal, state or local tax due to a portion of the
17,500 shares of common stock of the Company awarded to the Executive 


                                       2
<PAGE>   35

under the Company's 1997 Stock Award and Stock Option Plan (the "1997 Stock
Award") becoming transferable or the Executive making an election under Code
Section 83(b) with respect to the 1997 Stock Award.

            (n) "Term of Employment" shall mean the period specified in Section
2 below.

            (o) "Voting Stock" shall mean capital stock of any class or classes
having general voting power under ordinary circumstances, in the absence of
contingencies, to elect the directors of a corporation.

      2. Term of Employment.

            The Company hereby employs the Executive, and the Executive hereby
accepts such employment, for the period commencing on the Effective Date and
ending on the second anniversary of the Effective Date (the "Term of
Employment"), subject to earlier termination of the Term of Employment in
accordance with the terms of the Agreement. The Term of Employment shall be
automatically renewed for a one-year period on the second anniversary of the
Effective Date and on each anniversary of the Effective Date thereafter, unless
either Party has notified the other Party in writing in accordance with Section
26 below at least 90 days prior to the expiration of the then Term of Employment
that he or it does not want the Term of Employment to so renew.

      3. Position, Duties and Responsibilities.

            The Executive, in his capacity as President of MIR and a Senior
Vice-President of the Company shall faithfully perform for the Company the
duties of said office and shall perform such other duties of an executive,
managerial or administrative nature as shall be specified and designated from
time to time by the CEO consistent with such office. The Executive shall devote
substantially all of his business time and effort to the performance of his
duties hereunder. The Executive, in carrying out his duties under this
Agreement, shall report to the CEO. Notwithstanding anything in this Section 3
to the contrary, nothing shall preclude the Executive from:

                  (1)   serving on the boards of directors of a reasonable
                        number of other corporations or the boards of a
                        reasonable number of trade associations and/or
                        charitable organizations;

                  (2)   engaging in charitable activities and community affairs;
                        and

                  (3)   managing his personal investments and affairs;

provided, however, that such activities do not materially interfere with the
proper performance of his duties and responsibilities hereunder.

      4. Base Salary.

            During the Term of Employment, the Executive shall be paid an annual
Base Salary, payable in accordance with the regular payroll practices of the
Company, of $260,000. The Base Salary may be increased (but not decreased) at
any time and from time to time by action of the Board or by any committee
thereof or any individual having authority to take such action in accordance
with the Company's regular practices. Once increased, any reference to Base
Salary herein shall be a reference to such increased amount.


                                       3
<PAGE>   36

      5. Bonus.

            (a) During the Term of Employment, in addition to the Base Salary,
for each fiscal year of the Company ending during the Term of Employment, the
Executive shall have the opportunity to receive an annual bonus (an "Annual
Bonus") in an amount of between 30 and 50 percent of Base Salary, as determined
by the CEO, in consultation with the Chairman of the Board. Payment of Annual
Bonus shall be made at the same time that other senior-level executives receive
their annual incentive compensation awards.

            (b) Within 10 days of the date of the execution of this Agreement,
the Executive will receive a one-time payment in the amount of $150,000 in
consideration for the termination of the Executive's right to receive a change
of control payment pursuant to Section 11(f) of the Existing Employment
Agreement.

      6. Long-Term Incentive Compensation Programs.

            The Executive shall be eligible to participate in the Company's
stock option plans applicable to senior-level executives, the terms, conditions
and eligibility of such plans to be determined by the Board.

      7. Repayment of Tax Loans.

            The Executive shall pay to the Company in a lump sum the principal
and all accrued interest with respect to each outstanding Tax Loan on the day
which precedes the third anniversary of the date of such Tax Loan, or, at the
Executives's election, on any date which precedes the third anniversary of the
date of such Tax Loan.

      8. Employee Benefit Programs.

            (a) During the Term of Employment, the Executive, to the extent he
is eligible, shall be entitled to participate in those employee pension and
welfare benefit plans, programs and/or arrangements applicable to the Executive
and made available to the Company's senior-level executives or to its employees
generally, as such plans, programs and/or arrangements may be in effect from
time to time, including, without limitation, pension, profit-sharing, savings,
medical, dental, hospitalization, short-term disability, long-term disability,
life insurance, accidental death and dismemberment protection, travel accident
insurance, and other employee pension and welfare benefit plans, programs and/or
arrangements that may be sponsored by the Company from time to time.

            (b) During the Term of Employment, the Company shall provide the
Executive with term life insurance with a death benefit of at least two times
Base Salary. The Company shall pay all premiums with respect to such life
insurance. Such life insurance may be provided either through the Company's
group life insurance programs, by an individual policy, or by a combination of
both group and individual policies.

      9. Reimbursement of Business Expenses.

            The Executive is authorized to incur ordinary and reasonable
business expenses in carrying out his duties and responsibilities under the
Agreement, and the Company shall reimburse him for all such ordinary and
reasonable business expenses incurred in connection with carrying out the
business of the Company, subject to documentation in accordance with the
Company's policy.


                                       4
<PAGE>   37

      10. Perquisites.

            (a) During the Term of Employment, the Executive shall be entitled
to participate in the Company's executive fringe benefits applicable to the
Company's senior-level executive in accordance with the terms and conditions of
such arrangements as are in effect from time to time.

            (b) Notwithstanding anything herein to the contrary, the Company
shall pay for the membership fees (including any bond requirement) and dues at
one club which the Executive determines is appropriate.

            (c) During the Term of Employment, the Company shall provide a car
to the Executive.

      11. Vacation.

            The Executive shall be entitled to paid vacation in accordance with
the Company's vacation policy; provided, however, that the Executive shall be
entitled to not less than four weeks of vacation each year.

      12. Termination of Employment.

            (a) Termination of Employment Due to Death. In the event of the
Executive's death during the Term of Employment, the Term of Employment shall
end as of the date of the Executive's death and his estate and/or beneficiaries,
as the case may be, shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        his death;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of his death which has been earned but not paid;

                  (3)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 8, 9 or 10 above; and

                  (4)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (b) Termination of Employment Due to Disability. If the Executive's
employment is terminated due to Disability during the Term of Employment, either
by the Company or by the Executive, the Term of Employment shall end as of the
date of the Executive's termination of employment and the Executive shall be
entitled to the following (but in no event shall the Executive be entitled to
less than the benefits due him under any disability program of the Company for
which he becomes eligible):

                  (1)   Base Salary earned but not paid prior to the date of the
                        termination of the Executive's employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the sum of 50 percent of Base Salary,
                        at the annual rate in effect on the date of the
                        termination of the Executive's 


                                       5
<PAGE>   38

                        employment, payable in monthly installments for a period
                        ending on the first day of the month following the month
                        in which the Executive attains age 65 or recovers from
                        his Disability, whichever occurs earlier, less the
                        amount of any disability benefits provided to the
                        Executive under the Company's disability program;

                  (4)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 8, 9 or 10 above;

                  (5)   continued participation, as if the Executive were still
                        an employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in those other employee plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until he attains age 65 or recovers from his
                        Disability, whichever occurs earlier;

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program  or  arrangement  as  provided  in  this
                              Section 12(b)(5),  he shall be provided with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(b)(5); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (6)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            In no event shall a termination of the Executive's employment for
Disability occur unless the Party terminating his employment gives written
notice to the other Party in accordance with Section 26 below.

            (c) Termination of Employment by the Company for Cause. A
termination of the Executive's employment by the Company for Cause shall not
take effect unless the provisions of this Section 12(c) are complied with and
the Board issues a written determination that the Executive's employment should
be terminated for Cause (a "Determination").

                  (1)   In accordance with Section 26 below, the CEO shall give
                        the Executive a written notice stating his intention to
                        terminate the Executive's employment for Cause (the
                        "Cause Notice"). The Cause Notice shall:

                        (A)   state in detail the particular act or acts or
                              failure or failures to act that constitute the
                              grounds on which the proposed termination of
                              employment for Cause is based; and

                        (B)   be given within four months of the CEO learning of
                              such act or acts or failure or failures to act.


                                       6
<PAGE>   39

                  (2)   The CEO may temporarily relieve the Executive of his
                        duties and responsibilities described in Section 3 above
                        during the period commencing on the date the Cause
                        Notice is issued by the CEO and ending on the date the
                        Determination is issued by the Board (the "Determination
                        Period").

                  (3)   The Executive shall have 20 days after the date the
                        Cause Notice is actually received by him in which to
                        cure his conduct on which the termination of employment
                        for Cause is based, to the extent such cure is possible.
                        If the Executive fails to cure such conduct, he shall
                        then be entitled to a hearing before the Board. Such
                        hearing shall be held during the 20-day period following
                        the date the Executive receives the Cause Notice;
                        provided, however, that the Executive requests such
                        hearing during the 10-day period following the date the
                        Executive receives the Cause Notice. Within five days
                        following the completion of such hearing, the Board
                        shall issue a Determination stating whether, in its
                        judgment, grounds for Cause as detailed in the Cause
                        Notice exist. If the Determination states that such
                        grounds exist, the Executive's employment shall be
                        immediately terminated for Cause and the Term of
                        Employment shall end as of the date of the termination
                        of the Executive's employment.

                  (4)   If the Company terminates the Executive's employment for
                        Cause, the Executive shall be entitled to the following:

                        (A)   Base Salary earned but not paid prior to the date
                              of the termination of his employment;

                        (B)   any amounts earned, accrued or owing to the
                              Executive but not yet paid under Section 6, 8, 9
                              or 10 above; and

                        (C)   other or additional benefits in accordance with
                              applicable plans, programs and/or arrangements of
                              the Company.

                  (5)   Notwithstanding anything herein to the contrary, if,
                        following a termination of the Executive's employment by
                        the Company for Cause based upon the conviction of the
                        Executive for a felony, such conviction is overturned in
                        a final determination on appeal, the Executive shall be
                        entitled to the payments and the economic equivalent of
                        the benefits the Executive would have received if his
                        employment had been terminated by the Company without
                        Cause.

            (d) Termination of Employment by the Company Without Cause. If the
Executive's employment is terminated by the Company without Cause, other than
due to death or Disability, the Executive shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        the termination of his employment;


                                       7
<PAGE>   40

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the aggregate Base Salary (based on
                        the Base Salary in effect on the date of the termination
                        of the Executive's employment) (the "Salary Continuation
                        Benefits") with respect to a period equal to eighteen
                        months, payable in equal monthly installments over such
                        period;

                  (4)   continued accrual of credited service through the end of
                        the Term of Employment for the purpose of any Company
                        pension plan, program or arrangement;

                  (5)   the right to purchase, at fair market value, the
                        Executive's automobile (if any) provided to him by the
                        Company under the Company's automobile perquisite
                        program for senior-level executives;

                  (6)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 8, 9 or 10 above;

                  (7)   continued participation, as if he were still an
                        employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in other employee benefit plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until the earlier of:

                        (A)   the  end of the  period  used to  determine  the
                              Salary Continuation Benefits; or

                        (B)   the date, or dates, he receives equivalent
                              coverage and benefits under the plans, programs
                              and/or arrangements of a subsequent employer (such
                              coverage and benefits to be determined on a
                              coverage-by-coverage or benefit-by-benefit basis);

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program or  arrangement  as  provided in Section
                              12(d)(7)  above,  he shall be provided  with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(d)(7); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (8)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.


                                       8
<PAGE>   41

            (e) Termination of Employment by the Executive for Good Reason. The
Executive may terminate his employment for Good Reason, but only if:

                  (1)   the Executive notifies the Board during the 60-day
                        period following the date of the first occurrence of an
                        event which constitutes Good Reason (the "Good Reason
                        Event Date") of his intention to terminate his
                        employment for Good Reason;

                  (2)   the Executive terminates his employment for Good Reason
                        during the 120-day period following the Good Reason
                        Event Date;

                  (3)   the termination of employment for Good Reason does not
                        occur during a Determination Period described in Section
                        12(c)(2) above; and

                  (4)   the Good Reason first occurs before or after a
                        Determination Period, or, if the Good Reason first
                        occurs during a Determination Period, such event
                        constituting Good Reason continues to occur after the
                        Determination Period.

Upon a termination by the Executive of his employment for Good Reason, the
Executive shall be entitled to the same payments and benefits as provided in
Section 12(d) above; provided, however, that if the Executive terminates his
employment for Good Reason based on a reduction in Base Salary under Section
1(k)(2) above, then the Base Salary to be used in determining the Salary
Continuation Benefits in accordance with Section 12(d)(3) above shall be the
Base Salary in effect immediately prior to such reduction.

            (f) Termination of Employment by the Executive Without Good Reason.
If the Executive terminates his employment without Good Reason, other than a
termination of employment due to death or retirement or Disability, the
Executive shall have the same entitlements as provided in Section 12(c)(4)
above. A termination of the Executive's employment under this Section 12(f)
shall be effective upon 30 days prior written notice to the Company and shall
not be deemed a breach of this Agreement.

            (g) Non Renewal of Agreement by Company. If the Company notifies the
Executive, pursuant to Section 2 above, that it does not want the Term of
Employment to renew, the Executive shall have the same entitlements as provided
in Section 12(d) above as if the Executive had been terminated without cause as
of the last day of the then Term of Employment.

            (h) Termination of Employment by Executive due to Relocation of Work
Location. In the event that the Executive's principal work location is moved
outside of the States of New York, New Jersey, Connecticut, Pennsylvania,
Delaware, Maryland or the District of Columbia, the Executive may terminate his
employment with the Company. If the Executive terminates his employment pursuant
to this Section 12(h), he shall have the same entitlements as provided in
Section 12(d) above; provided, that all such benefits, including, without
limitation, the Salary Continuation Benefits, shall be provided for a period
equal to the corresponding severance period listed on Schedule A, payable in
equal monthly installments during such period.

            (i) No Mitigation; No Offset. If the Executive's employment
terminates under this Section 12, the Executive shall be under no obligation to
seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that he may obtain except as specifically provided in
this Section 12.


                                       9
<PAGE>   42

            (j) Nature of Payments. Any amounts due under this Section 12 are in
the nature of severance payments considered to be reasonable by the Company and
are not in the nature of a penalty.

      13. Confidentiality: Assignment of Rights.

            (a) During the Term of Employment and thereafter, the Executive
shall not disclose to anyone or make use of any trade secret or proprietary or
confidential information of the Company, including such trade secret or
proprietary or confidential information of any customer or other entity to which
the Company owes an obligation not to disclose such information, which he
acquires during the Term of Employment, including but not limited to records
kept in the ordinary course of business, except (i) as such disclosure or use
may be required or appropriate in connection with his work as an employee of the
Company, (ii) when required to do so by a court of law, by any governmental
agency having supervisory authority over the business of the Company or by any
administrative or legislative body (including a committee thereof) with apparent
jurisdiction to order him to divulge, disclose or make accessible such
information, or (iii) as to such confidential information that becomes generally
known to the public or trade without violation of this Section 13(a).

            (b) The Executive hereby sells, assigns and transfers to the Company
all of his right, title and interest in and to all inventions, discoveries,
improvements and copyrightable subject matter (the "rights") which during the
Term of Employment are made or conceived by him, alone or with others, and which
are within or arise out of any general field of the Company's business or arise
out of any work he performs or information he receives regarding the business of
the Company while employed by the Company. The Executive shall fully disclose to
the Company as promptly as available all information known or possessed by him
concerning the rights referred to in the preceding sentence, and upon request by
the Company and without any further remuneration in any form to him by the
Company, but at the expense of the Company, execute all applications for patents
and for copyright registration, assignments thereof and other instruments and do
all things which the Company may deem necessary to vest and maintain in it the
entire right, title and interest in and to all such rights. 

      14. Noncompetition.

            (a) The Executive covenants and agrees that during the Term of
Employment and, following the termination of the Executive's employment with the
Company, for a period of eighteen months or, in the case of a termination
pursuant to Section 12(h), a period equal to the shorter of (i) twice the
corresponding severance period listed on Schedule A and (ii) eighteen months, he
shall not at any time, without the prior written consent of the Company,
directly or indirectly, engage in a Competitive Activity.

            (b) The Parties acknowledge that in the event of a breach or
threatened breach of Section 14(a) above, the Company shall not have an adequate
remedy at law. Accordingly, in the event of any breach or threatened breach of
Section 14(a) above, the Company shall be entitled to such equitable and
injunctive relief as may be available to restrain the Executive and any
business, firm, partnership, individual, corporation or entity participating in
the breach or threatened breach from the violation of the provisions of Section
14(a) above. Nothing in this Agreement shall be construed as prohibiting the
Company from pursuing any other remedies available at law or in equity for
breach or threatened breach of Section 14(a) above, including the recovery of
damages.

      15. Indemnification.

            (a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a 


                                       10
<PAGE>   43

"Proceeding"), by reason of the fact that he is or was a director, officer or
employee of the Company or is or was serving at the request of the Company as a
director, officer, member, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether or not the basis of such Proceeding
is the Executive's alleged action in an official capacity while serving as a
director, officer, member, employee or agent, the Executive shall be indemnified
and held harmless by the Company to the fullest extent legally permitted or
authorized by the Company's certificate of incorporation or bylaws or
resolutions of the Company's Board of Directors or, if greater, by the laws of
the State of Delaware, against all cost, expense, liability and loss (including,
without limitation, attorney's fees, judgments, fines, ERISA excise taxes or
penalties and amounts paid or to be paid in settlement) reasonably incurred or
suffered by the Executive in connection therewith, and such indemnification
shall continue as to the Executive even if he has ceased to be a director,
member, employee or agent of the Company or other entity and shall inure to the
benefit of the Executive's heirs, executors and administrators. The Company
shall advance to the Executive all reasonable costs and expenses incurred by him
in connection with a Proceeding within 20 days after receipt by the Company of a
written request for such advance. Such request shall include an undertaking by
the Executive to repay the amount of such advance if it shall ultimately be
determined that he is not entitled to be indemnified against such costs and
expenses.

            (b) Neither the failure of the Company (including the Board,
independent legal counsel or stockholders) to have made a determination prior to
the commencement of any Proceeding concerning payment of amounts claimed by the
Executive under Section 15(a) above that indemnification of the Executive is
proper because he has met the applicable standard of conduct, nor a
determination by the Company (including the Board, independent legal counsel or
stockholders) that the Executive has not met such applicable standard of
conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct.

            (c) The Company agrees to continue and maintain a directors and
officers' liability insurance policy covering the Executive to the extent the
Company provides such coverage for its other executive officers.

      16. Effect of Agreement on Other Benefits.

            Except as specifically provided in this Agreement, the existence of
this Agreement shall not prohibit or restrict the Executive's entitlement to
full participation in the Company's employee benefit plans, programs and
arrangements applicable to the Company's senior-level executives.

      17. Assignability; Binding Nature.

            This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Company; provided, however, that the
assignee or transferee is the successor to all or substantially all of the
assets of the Company and such assignee or transferee assumes the liabilities,
obligations and duties of the Company, as contained in this Agreement, either
contractually or as a matter of law. The Company further agrees that, in the
event of a sale of assets or liquidation as described in the preceding sentence,
it shall take whatever action it legally can in order to cause such assignee or
transferee to expressly assume the liabilities, obligations and duties of the
Company hereunder or under any other plan or benefit program referred to herein.
No rights or obligations of the Executive under this Agreement may be 


                                       11
<PAGE>   44

assigned or transferred by the Executive other than his rights to compensation
and benefits, which may be transferred only by will or operation of law, except
as provided in Section 23 below.

      18. Representation.

            The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization. The Executive represents that he knows
of no agreement between him and any other person, firm or organization that
would be violated by the performance of his obligations under this Agreement.

      19. Entire Agreement.

            This Agreement contains the entire understanding and agreement
between the Parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the Parties, including, without limitation, the
Existing Employment Agreement, with respect thereto.

      20. Amendment or Waiver.

            No provision in this Agreement may be amended unless such amendment
is agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be.

      21. Severability.

            In the event that any provision or portion of this Agreement shall
be determined to be invalid or unenforceable for any reason, in whole or in
part, the remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect and such provision or portion of this
Agreement shall remain in effect to the fullest extent permitted by law.

      22. Survivorship.

            The respective rights and obligations of the Parties hereunder shall
survive any termination of the Executive's employment to the extent necessary to
the intended preservation of such rights and obligations.

      23. Beneficiaries/References.

            The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of his incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative.


                                       12
<PAGE>   45

      24. Governing Law/Submission to Jurisdiction.

            This Agreement shall be governed by and construed and interpreted in
accordance with the laws of New York without reference to principles of conflict
of laws. Each of the Company and the Executive hereby irrevocably and
unconditionally: (i) submits for itself or himself, as applicable, and its or
his property in any legal action or proceeding relating to this Agreement, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof; (ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection that it or he
may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an inconvenient
forum and agrees not to plead or claim the same; (iii) agrees that service of
process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, at its or his address set forth in or designated
pursuant to Section 26 hereof; and (iv) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.

      25. Resolution of Disputes.

            Any disputes arising under or in connection with the Agreement,
other than disputes arising in connection with Sections 14 or 15 hereof, may, at
the election of the Executive or the Company, be resolved by binding
arbitration, to be held in New York City in accordance with the rules and
procedures of the American Arbitration Association. If arbitration is elected,
the Executive and the Company shall mutually select the arbitrator. If the
Executive and the Company cannot agree on the selection of an arbitrator, each
Party shall select an arbitrator and the two arbitrators shall select a third
arbitrator, and the three arbitrators shall form an arbitration panel which
shall resolve the dispute by majority vote. Judgment upon the award rendered by
the arbitrator(s) may be entered in any court having jurisdiction thereof. Costs
of the arbitration or litigation, including, without limitation, reasonable
attorneys' fees of both Parties, shall be borne by the Company; provided,
however, that, if a dispute is resolved in favor of the Company, the Executive
shall bear his own costs of the arbitration or litigation and shall reimburse
the Company for the Executive's costs of the arbitration or litigation
previously paid by the Company. Pending the resolution of any arbitration or
court proceeding, the Company shall continue payment of all amounts due the
Executive under this Agreement and all benefits to which the Executive is
entitled at the time the dispute arises.

      26. Notices.

            Any notice given to a Party shall be in writing and shall be deemed
to have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the Party
concerned at the address indicated below or to such changed address as such
Party may subsequently give such notice of:

If to the Company:            Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017
                              Attention: General Counsel

With a copy to:               Rogers & Wells LLP
                              200 Park Avenue
                              New York, New York 10166
                              Attention: Samuel M. Feder


                                       13
<PAGE>   46

If to the Executive:          Robin Brumwell
                              c/o Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017

      27. Headings.

            The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

      28. Counterparts.

            This Agreement may be executed in two or more counterparts.


                                       14
<PAGE>   47

      IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

                                    METALLURG, INC.

                                    By: /s/ Alan D. Ewart
                                        --------------------------------------
                                        Name: Alan D. Ewart
                                        Title: President and CEO

                                        /s/ Robin Brumwell
                                        --------------------------------------
                                        Robin Brumwell


                                       15
<PAGE>   48

                                   SCHEDULE A

<TABLE>
<CAPTION>
            Years of Service                    Severance Period
            ----------------                    ----------------
            <S>                                 <C>
            Up To 15                            6 months

            More Than 15                        9 months

            More Than 20                        12 months
</TABLE>


                                       16
<PAGE>   49

                              EMPLOYMENT AGREEMENT

      AGREEMENT, made and entered into as of the 20th day of November, 1998, by
and between Metallurg, Inc., a Delaware corporation (together with its
successors and assigns permitted under this Agreement, the "Company"), and Barry
C. Nuss (the "Executive").

                              W I T N E S S E T H :

      WHEREAS,  the  Executive  is  the  Vice  President,  Finance  and  Chief
Financial Officer of the Company; and

      WHEREAS, the Company and the Executive entered into an employment
agreement, dated April 14, 1997 which is currently in effect (the "Existing
Employment Agreement"); and

      WHEREAS, the Company desires to continue the employment of the Executive
and to enter into a new employment agreement (the "Agreement") embodying the
terms of such employment; and

      WHEREAS, the Executive desires to enter into the Agreement and to accept
such employment, subject to the terms and provisions of the Agreement; and

      WHEREAS, the Company and the Executive desire to cancel the Existing
Employment Agreement as of the Effective Date (as defined below);

      NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (individually a
"Party" and together the "Parties") agree as follows:

      1. Definitions.

            (a) "Base Salary" shall mean the Executive's base salary in
accordance with Section 4 below.

            (b) "Board" shall mean the Board of Directors of the Company.

            (c) "Business Day" shall mean any day other than a Saturday, Sunday
or any other day on which commercial banks in New York, New York are required or
authorized to be closed.

            (d) "Cause" shall mean:

                  (1)   the Executive is convicted of (or pleads nolo contendere
                        to) a felony or a crime of moral turpitude, dishonesty,
                        breach of trust or unethical business conduct involving
                        the Company;

                  (2)   the Executive engages in willful misconduct, willful or
                        gross neglect, fraud, insubordination, misappropriation
                        or embezzlement to the material and demonstrable
                        detriment of the Company; or

                  (3)   the Executive breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Company specifying such breach.

            (e) "CEO" shall mean the chief executive officer of the Company.


                                       1
<PAGE>   50

            (f) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, including applicable regulations thereunder.

            (g) "Competitive Activity" shall mean any activity engaged in by the
Executive, whether as an employee, principal, sole proprietor, consultant,
agent, officer, director, partner or shareholder (except as a less than
one-percent shareholder of a publicly traded company or a less than five-percent
shareholder of a privately held company), which directly competes with the
Company or any Subsidiary. For this purpose, an activity which directly competes
with the Company or any Subsidiary shall mean a business that was being
conducted by the Company or any Subsidiary during the Term of Employment.
Notwithstanding anything to the contrary in this Section 1(g), an activity shall
not be deemed to be a Competitive Activity (x) solely as a result of the
Executive's being employed by or otherwise associated with a business of which a
unit is in competition with the Company or any Subsidiary but as to which unit
the Executive does not have direct or indirect responsibilities for the products
or product lines involved or (y) if the activity contributes less than 5 percent
of the revenues for the fiscal year in question of the business by which the
Executive is employed or with which he is otherwise associated.

            (h) "Disability" shall mean a disability as determined under the
Company's long-term disability plans, programs and/or arrangements in effect on
the date such disability first occurs.

            (i) "Effective Date" shall mean August 10, 1998.

            (j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time, including applicable regulations thereunder.

            (k) "Good Reason" shall mean the occurrence of any of the following
events:

                  (1)   the material change of the Executive's authority, duties
                        and responsibilities, or the assignment to the Executive
                        of duties materially different from the Executive's
                        position or positions with the Company;

                  (2)   a reduction in Base Salary of the Executive;

                  (3)   the failure by the Company to obtain an agreement in
                        form and substance reasonably satisfactory to the
                        Executive from any successor to the business of the
                        Company to assume and agree to perform this Agreement;
                        or

                  (4)   the Company breaches in any material respect the terms
                        and provisions of this Agreement and fails to cure such
                        breach within 20 days following written notice from the
                        Executive specifying such breach.

            (l) "Subsidiary" of the Company shall mean any corporation of which
the Company owns, directly or indirectly, more than 50 percent of the Voting
Stock or any other business entity in which the Company directly or indirectly
has an ownership interest of more than 50 percent.

            (m) "Tax Loans" shall mean all of the outstanding loans made by the
Company to the Executive pursuant to Section 6(c) of the Existing Employment
Agreement in respect of federal, state or local tax due to a portion of the
32,500 shares of common stock of the Company awarded to the Executive under the
Company's 1997 Stock Award and Stock Option Plan (the "1997 Stock Award")
becoming 


                                       2
<PAGE>   51

transferable or the Executive making an election under Code Section 83(b) with
respect to the 1997 Stock Award.

            (n) "Term of Employment" shall mean the period specified in Section
2 below.

            (o) "Voting Stock" shall mean capital stock of any class or classes
having general voting power under ordinary circumstances, in the absence of
contingencies, to elect the directors of a corporation.

      2. Term of Employment.

            The Company hereby employs the Executive, and the Executive hereby
accepts such employment, for the period commencing on the Effective Date and
ending on the second anniversary of the Effective Date (the "Term of
Employment"), subject to earlier termination of the Term of Employment in
accordance with the terms of the Agreement. The Term of Employment shall be
automatically renewed for a one-year period on the second anniversary of the
Effective Date and on each anniversary of the Effective Date thereafter, unless
either Party has notified the other Party in writing in accordance with Section
26 below at least 90 days prior to the expiration of the then Term of Employment
that he or it does not want the Term of Employment to so renew.

      3. Position, Duties and Responsibilities.

            The Executive, in his capacity as Vice President, Finance and Chief
Financial Officer, shall faithfully perform for the Company the duties of said
office and shall perform such other duties of an executive, managerial or
administrative nature as shall be specified and designated from time to time by
the CEO consistent with such office. The Executive shall devote substantially
all of his business time and effort to the performance of his duties hereunder.
The Executive, in carrying out his duties under this Agreement, shall report to
the CEO. Notwithstanding anything in this Section 3 to the contrary, nothing
shall preclude the Executive from:

                  (1)   serving on the boards of directors of a reasonable
                        number of other corporations or the boards of a
                        reasonable number of trade associations and/or
                        charitable organizations;

                  (2)   engaging in charitable activities and community affairs;
                        and

                  (3)   managing his personal investments and affairs;

provided, however, that such activities do not materially interfere with the
proper performance of his duties and responsibilities hereunder.

      4. Base Salary.

            During the Term of Employment, the Executive shall be paid an annual
Base Salary, payable in accordance with the regular payroll practices of the
Company, of $240,000. The Base Salary may be increased (but not decreased) at
any time and from time to time by action of the Board or by any committee
thereof or any individual having authority to take such action in accordance
with the Company's regular practices. Once increased, any reference to Base
Salary herein shall be a reference to such increased amount.


                                       3
<PAGE>   52

      5. Bonus.

            (a) During the Term of Employment, in addition to the Base Salary,
for each fiscal year of the Company ending during the Term of Employment, the
Executive shall have the opportunity to receive an annual bonus (an "Annual
Bonus") in an amount of between 30 and 50 percent of Base Salary, as determined
by the CEO, in consultation with the Chairman of the Board. Payment of Annual
Bonus shall be made at the same time that other senior-level executives receive
their annual incentive compensation awards.

            (b) Within 10 days of the date of the execution of this Agreement,
the Executive will receive a one-time payment in the amount of $150,000 in
consideration for the termination of the Executive's right to receive a change
of control payment pursuant to Section 11(f) of the Existing Employment
Agreement.

      6. Long-Term Incentive Compensation Programs.

            The Executive shall be eligible to participate in the Company's
stock option plans applicable to senior-level executives, the terms, conditions
and eligibility of such plans to be determined by the Board.

      7. Repayment of Tax Loans.

            The Executive shall pay to the Company in a lump sum the principal
and all accrued interest with respect to each outstanding Tax Loan on the day
which precedes the third anniversary of the date of such Tax Loan, or, at the
Executives's election, on any date which precedes the third anniversary of the
date of such Tax Loan.

      8. Employee Benefit Programs.

            (a) During the Term of Employment, the Executive, to the extent he
is eligible, shall be entitled to participate in those employee pension and
welfare benefit plans, programs and/or arrangements applicable to the Executive
and made available to the Company's senior-level executives or to its employees
generally, as such plans, programs and/or arrangements may be in effect from
time to time, including, without limitation, pension, profit-sharing, savings,
medical, dental, hospitalization, short-term disability, long-term disability,
life insurance, accidental death and dismemberment protection, travel accident
insurance, and other employee pension and welfare benefit plans, programs and/or
arrangements that may be sponsored by the Company from time to time.

            (b) During the Term of Employment, the Company shall provide the
Executive with term life insurance with a death benefit of at least two times
Base Salary. The Company shall pay all premiums with respect to such life
insurance. Such life insurance may be provided either through the Company's
group life insurance programs, by an individual policy, or by a combination of
both group and individual policies.

      9. Reimbursement of Business Expenses.

            The Executive is authorized to incur ordinary and reasonable
business expenses in carrying out his duties and responsibilities under the
Agreement, and the Company shall reimburse him for all such ordinary and
reasonable business expenses incurred in connection with carrying out the
business of the Company, subject to documentation in accordance with the
Company's policy.


                                       4
<PAGE>   53

      10. Perquisites.

            (a) During the Term of Employment, the Executive shall be entitled
to participate in the Company's executive fringe benefits applicable to the
Company's senior-level executive in accordance with the terms and conditions of
such arrangements as are in effect from time to time.

            (b) During the Term of Employment, the Company shall provide a car
to the Executive.

      11. Vacation.

            The Executive shall be entitled to paid vacation in accordance with
the Company's vacation policy; provided, however, that the Executive shall be
entitled to not less than four weeks of vacation each year.

      12. Termination of Employment.

            (a) Termination of Employment Due to Death. In the event of the
Executive's death during the Term of Employment, the Term of Employment shall
end as of the date of the Executive's death and his estate and/or beneficiaries,
as the case may be, shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        his death;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of his death which has been earned but not paid;

                  (3)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 8, 9, 10 or 11 above;
                        and

                  (4)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (b) Termination of Employment Due to Disability. If the Executive's
employment is terminated due to Disability during the Term of Employment, either
by the Company or by the Executive, the Term of Employment shall end as of the
date of the Executive's termination of employment and the Executive shall be
entitled to the following (but in no event shall the Executive be entitled to
less than the benefits due him under any disability program of the Company for
which he becomes eligible):

                  (1)   Base Salary earned but not paid prior to the date of the
                        termination of the Executive's employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;

                  (3)   an amount equal to the sum of 50 percent of Base Salary,
                        at the annual rate in effect on the date of the
                        termination of the Executive's employment, payable in
                        monthly installments for a period ending on the first
                        day of the month following the month in which the
                        Executive attains age 65 or recovers from his
                        Disability, whichever occurs earlier, less the 


                                       5
<PAGE>   54

                        amount of any disability benefits provided to the
                        Executive under the Company's disability program;

                  (4)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 8, 9, 10 or 11 above;
                        and

                  (5)   continued participation, as if the Executive were still
                        an employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in those other employee plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until he attains age 65 or recovers from his
                        Disability, whichever occurs earlier; and

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program  or  arrangement  as  provided  in  this
                              Section 12(b)(5),  he shall be provided with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(b)(5); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (6)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            In no event shall a termination of the Executive's employment for
Disability occur unless the Party terminating his employment gives written
notice to the other Party in accordance with Section 26 below.

            (c) Termination of Employment by the Company for Cause. A
termination of the Executive's employment by the Company for Cause shall not
take effect unless the provisions of this Section 12(c) are complied with and
the Board issues a written determination that the Executive's employment should
be terminated for Cause (a "Determination").

                  (1)   In accordance with Section 26 below, the CEO shall give
                        the Executive a written notice stating his intention to
                        terminate the Executive's employment for Cause (the
                        "Cause Notice"). The Cause Notice shall:

                        (A)   state in detail the particular act or acts or
                              failure or failures to act that constitute the
                              grounds on which the proposed termination of
                              employment for Cause is based; and

                        (B)   be given within four months of the CEO learning of
                              such act or acts or failure or failures to act.

                  (2)   The CEO may temporarily relieve the Executive of his
                        duties and responsibilities described in Section 3 above
                        during the period 


                                       6
<PAGE>   55

                        commencing on the date the Cause Notice is issued by the
                        CEO and ending on the date the Determination is issued
                        by the Board (the "Determination Period").

                  (3)   The Executive shall have 20 days after the date the
                        Cause Notice is actually received by him in which to
                        cure his conduct on which the termination of employment
                        for Cause is based, to the extent such cure is possible.
                        If the Executive fails to cure such conduct, he shall
                        then be entitled to a hearing before the Board. Such
                        hearing shall be held during the 20-day period following
                        the date the Executive receives the Cause Notice;
                        provided, however, that the Executive requests such
                        hearing during the 10-day period following the date the
                        Executive receives the Cause Notice. Within five days
                        following the completion of such hearing, the Board
                        shall issue a Determination stating whether, in its
                        judgment, grounds for Cause as detailed in the Cause
                        Notice exist. If the Determination states that such
                        grounds exist, the Executive's employment shall be
                        immediately terminated for Cause and the Term of
                        Employment shall end as of the date of the termination
                        of the Executive's employment.

                  (4)   If the Company terminates the Executive's employment for
                        Cause, the Executive shall be entitled to the following:

                        (A)   Base Salary earned but not paid prior to the date
                              of the termination of his employment;

                        (B)   any amounts earned, accrued or owing to the
                              Executive but not yet paid under Section 6, 8, 9,
                              10 or 11 above; and

                        (C)   other or additional benefits in accordance with
                              applicable plans, programs and/or arrangements of
                              the Company.

                  (5)   Notwithstanding anything herein to the contrary, if,
                        following a termination of the Executive's employment by
                        the Company for Cause based upon the conviction of the
                        Executive for a felony, such conviction is overturned in
                        a final determination on appeal, the Executive shall be
                        entitled to the payments and the economic equivalent of
                        the benefits the Executive would have received if his
                        employment had been terminated by the Company without
                        Cause.

            (d) Termination of Employment by the Company Without Cause. If the
Executive's employment is terminated by the Company without Cause, other than
due to death or Disability, the Executive shall be entitled to the following:

                  (1)   Base  Salary  earned but not paid prior to the date of
                        the termination of his employment;

                  (2)   Annual Bonus with respect to any year prior to the year
                        of the termination of the Executive's employment which
                        has been earned but not paid;


                                       7
<PAGE>   56

                  (3)   an amount equal to the aggregate Base Salary (based on
                        the Base Salary in effect on the date of the termination
                        of the Executive's employment) (the "Salary Continuation
                        Benefits") with respect to a period equal to eighteen
                        months, payable in equal monthly installments over such
                        period;

                  (4)   continued accrual of credited service through the end of
                        the Term of Employment for the purpose of any Company
                        pension plan, program or arrangement;

                  (5)   the right to purchase, at fair market value, the
                        Executive's automobile (if any) provided to him by the
                        Company under the Company's automobile perquisite
                        program for senior-level executives;

                  (6)   any amounts earned, accrued or owing to the Executive
                        but not yet paid under Section 6, 8, 9, 10 or 11 above;

                  (7)   continued participation, as if he were still an
                        employee, in the Company's medical, dental,
                        hospitalization and life insurance plans, programs
                        and/or arrangements and in other employee benefit plans,
                        programs and/or arrangements in which he was
                        participating on the date of the termination of his
                        employment until the earlier of:

                        (A)   the  end of the  period  used to  determine  the
                              Salary Continuation Benefits; or

                        (B)   the date, or dates, he receives equivalent
                              coverage and benefits under the plans, programs
                              and/or arrangements of a subsequent employer (such
                              coverage and benefits to be determined on a
                              coverage-by-coverage or benefit-by-benefit basis);

                        provided, however, that:

                        (X)   if the  Executive is precluded  from  continuing
                              his  participation in any employee benefit plan,
                              program or  arrangement  as  provided in Section
                              12(d)(7)  above,  he shall be provided  with the
                              after-tax  economic  equivalent  of the benefits
                              provided under the plan,  program or arrangement
                              in which he is  unable  to  participate  for the
                              period specified in this Section 12(d)(7); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit himself on an individual basis; and

                  (8)   other or additional benefits in accordance with
                        applicable plans, programs and/or arrangements of the
                        Company.

            (e) Termination of Employment by the Executive for Good Reason. The
Executive may terminate his employment for Good Reason, but only if:


                                       8
<PAGE>   57

                  (1)   the Executive notifies the Board during the 60-day
                        period following the date of the first occurrence of an
                        event which constitutes Good Reason (the "Good Reason
                        Event Date") of his intention to terminate his
                        employment for Good Reason;

                  (2)   the Executive terminates his employment for Good Reason
                        during the 120-day period following the Good Reason
                        Event Date;

                  (3)   the termination of employment for Good Reason does not
                        occur during a Determination Period described in Section
                        12(c)(2) above; and

                  (4)   the Good Reason first occurs before or after a
                        Determination Period, or, if the Good Reason first
                        occurs during a Determination Period, such event
                        constituting Good Reason continues to occur after the
                        Determination Period.

Upon a termination by the Executive of his employment for Good Reason, the
Executive shall be entitled to the same payments and benefits as provided in
Section 12(d) above; provided, however, that if the Executive terminates his
employment for Good Reason based on a reduction in Base Salary under Section
1(k)(2) above, then the Base Salary to be used in determining the Salary
Continuation Benefits in accordance with Section 12(d)(3) above shall be the
Base Salary in effect immediately prior to such reduction.

            (f) Termination of Employment by the Executive Without Good Reason.
If the Executive terminates his employment without Good Reason, other than a
termination of employment due to death or retirement or Disability, the
Executive shall have the same entitlements as provided in Section 12(c)(4)
above. A termination of the Executive's employment under this Section 12(f)
shall be effective upon 30 days prior written notice to the Company and shall
not be deemed a breach of this Agreement.

            (g) Non Renewal of Agreement by Company. If the Company notifies the
Executive, pursuant to Section 2 above, that it does not want the Term of
Employment to renew, the Executive shall have the same entitlements as provided
in Section 12(d) above as if the Executive had been terminated without cause as
of the last day of the then Term of Employment.

            (h) Termination of Employment by Executive due to Relocation of Work
Location. In the event that the Executive's principal work location is moved
outside of the States of New York, New Jersey, Connecticut, Pennsylvania,
Delaware, Maryland or the District of Columbia, the Executive may terminate his
employment with the Company. If the Executive terminates his employment pursuant
to this Section 12(h), he shall have the same entitlements as provided in
Section 12(d) above; provided, that all such benefits, including without
limitation, the Salary Continuation Benefits, shall be provided for a period
equal to the corresponding severance period listed on Schedule A, payable in
equal monthly installments during such period.

            (i) No Mitigation; No Offset. If the Executive's employment
terminates under this Section 12, the Executive shall be under no obligation to
seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that he may obtain except as specifically provided in
this Section 12.

            (j) Nature of Payments. Any amounts due under this Section 12 are in
the nature of severance payments considered to be reasonable by the Company and
are not in the nature of a penalty.


                                       9
<PAGE>   58

      13. Confidentiality: Assignment of Rights.

            (a) During the Term of Employment and thereafter, the Executive
shall not disclose to anyone or make use of any trade secret or proprietary or
confidential information of the Company, including such trade secret or
proprietary or confidential information of any customer or other entity to which
the Company owes an obligation not to disclose such information, which he
acquires during the Term of Employment, including but not limited to records
kept in the ordinary course of business, except (i) as such disclosure or use
may be required or appropriate in connection with his work as an employee of the
Company, (ii) when required to do so by a court of law, by any governmental
agency having supervisory authority over the business of the Company or by any
administrative or legislative body (including a committee thereof) with apparent
jurisdiction to order him to divulge, disclose or make accessible such
information, or (iii) as to such confidential information that becomes generally
known to the public or trade without violation of this Section 13(a).

            (b) The Executive hereby sells, assigns and transfers to the Company
all of his right, title and interest in and to all inventions, discoveries,
improvements and copyrightable subject matter (the "rights") which during the
Term of Employment are made or conceived by him, alone or with others, and which
are within or arise out of any general field of the Company's business or arise
out of any work he performs or information he receives regarding the business of
the Company while employed by the Company. The Executive shall fully disclose to
the Company as promptly as available all information known or possessed by him
concerning the rights referred to in the preceding sentence, and upon request by
the Company and without any further remuneration in any form to him by the
Company, but at the expense of the Company, execute all applications for patents
and for copyright registration, assignments thereof and other instruments and do
all things which the Company may deem necessary to vest and maintain in it the
entire right, title and interest in and to all such rights.

      14. Noncompetition.

            (a) The Executive covenants and agrees that during the Term of
Employment and following the termination of the Executive's employment with the
Company, for a period of eighteen months or, in the case of a termination
pursuant to Section 12(h), a period equal to the shorter of (i) twice the
corresponding severance period listed on Schedule A and (ii) eighteen months, he
shall not at any time, without the prior written consent of the Company,
directly or indirectly, engage in a Competitive Activity.

            (b) The Parties acknowledge that in the event of a breach or
threatened breach of Section 14(a) above, the Company shall not have an adequate
remedy at law. Accordingly, in the event of any breach or threatened breach of
Section 14(a) above, the Company shall be entitled to such equitable and
injunctive relief as may be available to restrain the Executive and any
business, firm, partnership, individual, corporation or entity participating in
the breach or threatened breach from the violation of the provisions of Section
14(a) above. Nothing in this Agreement shall be construed as prohibiting the
Company from pursuing any other remedies available at law or in equity for
breach or threatened breach of Section 14(a) above, including the recovery of
damages.

      15. Indemnification.

            (a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of the
fact that he is or was a director, officer or employee of the Company or is or
was serving at the request of the Company as a director, officer, member,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to 


                                       10
<PAGE>   59

employee benefit plans, whether or not the basis of such Proceeding is the
Executive's alleged action in an official capacity while serving as a director,
officer, member, employee or agent, the Executive shall be indemnified and held
harmless by the Company to the fullest extent legally permitted or authorized by
the Company's certificate of incorporation or bylaws or resolutions of the
Company's Board of Directors or, if greater, by the laws of the State of
Delaware, against all cost, expense, liability and loss (including, without
limitation, attorney's fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid or to be paid in settlement) reasonably incurred or suffered by
the Executive in connection therewith, and such indemnification shall continue
as to the Executive even if he has ceased to be a director, member, employee or
agent of the Company or other entity and shall inure to the benefit of the
Executive's heirs, executors and administrators. The Company shall advance to
the Executive all reasonable costs and expenses incurred by him in connection
with a Proceeding within 20 days after receipt by the Company of a written
request for such advance. Such request shall include an undertaking by the
Executive to repay the amount of such advance if it shall ultimately be
determined that he is not entitled to be indemnified against such costs and
expenses.

            (b) Neither the failure of the Company (including the Board,
independent legal counsel or stockholders) to have made a determination prior to
the commencement of any Proceeding concerning payment of amounts claimed by the
Executive under Section 15(a) above that indemnification of the Executive is
proper because he has met the applicable standard of conduct, nor a
determination by the Company (including the Board, independent legal counsel or
stockholders) that the Executive has not met such applicable standard of
conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct.

            (c) The Company agrees to continue and maintain a directors and
officers' liability insurance policy covering the Executive to the extent the
Company provides such coverage for its other executive officers.

      16. Effect of Agreement on Other Benefits.

            Except as specifically provided in this Agreement, the existence of
this Agreement shall not prohibit or restrict the Executive's entitlement to
full participation in the Company's employee benefit plans, programs and
arrangements applicable to the Company's senior-level executives.

      17. Assignability; Binding Nature.

            This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Company; provided, however, that the
assignee or transferee is the successor to all or substantially all of the
assets of the Company and such assignee or transferee assumes the liabilities,
obligations and duties of the Company, as contained in this Agreement, either
contractually or as a matter of law. The Company further agrees that, in the
event of a sale of assets or liquidation as described in the preceding sentence,
it shall take whatever action it legally can in order to cause such assignee or
transferee to expressly assume the liabilities, obligations and duties of the
Company hereunder or under any other plan or benefit program referred to herein.
No rights or obligations of the Executive under this Agreement may be assigned
or transferred by the Executive other than his rights to compensation and
benefits, which may be transferred only by will or operation of law, except as
provided in Section 23 below.


                                       11
<PAGE>   60

      18. Representation.

            The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization. The Executive represents that he knows
of no agreement between him and any other person, firm or organization that
would be violated by the performance of his obligations under this Agreement.

      19. Entire Agreement.

            This Agreement contains the entire understanding and agreement
between the Parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the Parties, including, without limitation, the
Existing Employment Agreement, with respect thereto.

      20. Amendment or Waiver.

            No provision in this Agreement may be amended unless such amendment
is agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be.

      21. Severability.

            In the event that any provision or portion of this Agreement shall
be determined to be invalid or unenforceable for any reason, in whole or in
part, the remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect and such provision or portion of this
Agreement shall remain in effect to the fullest extent permitted by law.

      22. Survivorship.

            The respective rights and obligations of the Parties hereunder shall
survive any termination of the Executive's employment to the extent necessary to
the intended preservation of such rights and obligations.

      23. Beneficiaries/References.

            The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of his incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative.

      24. Governing Law/Submission to Jurisdiction.

            This Agreement shall be governed by and construed and interpreted in
accordance with the laws of New York without reference to principles of conflict
of laws. Each of the Company and the Executive hereby irrevocably and
unconditionally: (i) submits for itself or himself, as applicable, and its 


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<PAGE>   61

or his property in any legal action or proceeding relating to this Agreement, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof; (ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection that it or he
may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an inconvenient
forum and agrees not to plead or claim the same; (iii) agrees that service of
process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to its or his address set forth in or designated
pursuant to Section 26 hereof; and (iv) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.

      25. Resolution of Disputes.

            Any disputes arising under or in connection with the Agreement,
other than disputes arising in connection with Sections 13 and 14 hereof, may,
at the election of the Executive or the Company, be resolved by binding
arbitration, to be held in New York City in accordance with the rules and
procedures of the American Arbitration Association. If arbitration is elected,
the Executive and the Company shall mutually select the arbitrator. If the
Executive and the Company cannot agree on the selection of an arbitrator, each
Party shall select an arbitrator and the two arbitrators shall select a third
arbitrator, and the three arbitrators shall form an arbitration panel which
shall resolve the dispute by majority vote. Judgment upon the award rendered by
the arbitrator(s) may be entered in any court having jurisdiction thereof. Costs
of the arbitration or litigation, including, without limitation, reasonable
attorneys' fees of both Parties, shall be borne by the Company; provided,
however, that, if a dispute is resolved in favor of the Company, the Executive
shall bear his own costs of the arbitration or litigation and shall reimburse
the Company for the Executive's costs of the arbitration or litigation
previously paid by the Company. Pending the resolution of any arbitration or
court proceeding, the Company shall continue payment of all amounts due the
Executive under this Agreement and all benefits to which the Executive is
entitled at the time the dispute arises.

      26. Notices.

            Any notice given to a Party shall be in writing and shall be deemed
to have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the Party
concerned at the address indicated below or to such changed address as such
Party may subsequently give such notice of:

If to the Company:            Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017
                              Attention: General Counsel

With a copy to:               Rogers & Wells LLP
                              200 Park Avenue
                              New York, New York 10166
                              Attention: Samuel M. Feder

If to the Executive:          Barry C. Nuss
                              c/o Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017


                                       13
<PAGE>   62

      27. Headings.

            The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

      28. Counterparts.

            This Agreement may be executed in two or more counterparts.


                                       14
<PAGE>   63

      IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

                                    METALLURG, INC.

                                    By: /s/ Alan D. Ewart
                                        ------------------------------------
                                        Name: Alan D. Ewart
                                        Title: President and CEO

                                        /s/ Barry C. Nuss
                                        ------------------------------------
                                        Barry C. Nuss


                                       15
<PAGE>   64

                                   SCHEDULE A

<TABLE>
<CAPTION>
            Years of Service                    Severance Period
            ----------------                    ----------------
            <S>                                 <C>
            Up To 15                            6 months

            More Than 15                        9 months

            More Than 20                        12 months
</TABLE>


                                       16
<PAGE>   65

                              EMPLOYMENT AGREEMENT

      AGREEMENT, made and entered into as of the 4th day of January, 1999, by
and between Metallurg, Inc., a Delaware corporation (together with its
successors and assigns permitted under this Agreement, the "Company"), and Ellen
T. Harmon (the "Executive").

                              W I T N E S S E T H:

      WHEREAS, the Company desires to enter into a employment agreement (the
"Agreement") embodying the terms of such employment; and

      WHEREAS, the Executive desires to enter into the Agreement and to accept
such employment, subject to the terms and provisions of the Agreement; and

      NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (individually a
"Party" and together the "Parties") agree as follows:

      1. Definitions.

      (a) "Base Salary" shall mean the Executive's base salary in accordance
with Section 4 below.

      (b) "Board" shall mean the Board of Directors of the Company.

      (c) "Business Day" shall mean any day other than a Saturday, Sunday or any
other day on which commercial banks in New York, New York are required or
authorized to be closed.

      (d) "Cause" shall mean:

            (1) the Executive is convicted of (or pleads nolo contendere to) a
      felony or a crime of moral turpitude, dishonesty, breach of trust or
      unethical business conduct involving the Company;

            (2) the Executive engages in willful misconduct, willful or gross
      neglect, fraud, insubordination , misappropriation or embezzlement to the
      material and demonstrable detriment of the Company; or

            (3) the Executive breaches in any material respect the terms and
      provisions of this Agreement and fails to cure such breach within 20 days
      following written notice from the Company specifying such breach.

      (e) "CEO" shall mean the chief executive officer of the Company.

      (f) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, including applicable regulations thereunder.

      (g) "Competitive Activity" shall mean any activity engaged in by the
Executive, whether as an employee, principal, sole proprietor, consultant,
agent, officer, director, partner or shareholder (except as a less than
one-percent shareholder of a publicly traded company or a less than five-percent
shareholder of a privately held company), which directly competes with the
Company or any Subsidiary. For this purpose, an activity which directly competes
with the Company or any Subsidiary shall mean a 

<PAGE>   66

business that was being conducted by the Company or any Subsidiary during the
Term of Employment. Notwithstanding anything to the contrary in this Section
1(g), an activity shall not be deemed to be a Competitive Activity (x) solely as
a result of the Executive's being employed by or otherwise associated with a
business of which a unit is in competition with the Company or any Subsidiary
but as to which unit the Executive does not have direct or indirect
responsibilities for the products or product lines involved or (y) if the
activity contributes less than 5 percent of the revenues for the fiscal year in
question of the business by which the Executive is employed or with which she is
otherwise associated.

      (h) "Disability" shall mean a disability as determined under the Company's
long-term disability plans, programs and/or arrangements in effect on the date
such disability first occurs.

      (i) "Effective Date" shall mean January 4, 1999.

      (j) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, including applicable regulations thereunder.

      (k) "Good Reason" shall mean the occurrence of any of the following
events:

            (1) the material change of the Executive's authority, duties and
      responsibilities, or the assignment to the Executive of duties materially
      different from the Executive's position or positions with the Company;

            (2) a reduction in Base Salary of the Executive;

            (3) the failure by the Company to obtain an agreement in form and
      substance reasonably satisfactory to the Executive from any successor to
      the business of the Company to assume and agree to perform this Agreement;
      or

            (4) the Company breaches in any material respect the terms and
      provisions of this Agreement and fails to cure such breach within 20 days
      following written notice from the Executive specifying such breach.

      (l) "Subsidiary" of the Company shall mean any corporation of which the
Company owns, directly or indirectly, more than 50 percent of the Voting Stock
or any other business entity in which the Company directly or indirectly has an
ownership interest of more than 50 percent.

      (m) "Term of Employment" shall mean the period specified in Section 2
below.

      (n) "Voting Stock" shall mean capital stock of any class or classes having
general voting power under ordinary circumstances, in the absence of
contingencies, to elect the directors of a corporation.

      2. Term of Employment.

      The Company hereby employs the Executive, and the Executive hereby accepts
such employment, for the period commencing on the Effective Date and ending on
the first anniversary of the Effective Date (the "Term of Employment"), subject
to earlier termination of the Term of Employment in accordance with the terms of
the Agreement. The Term of Employment shall be automatically renewed for a
two-year period on the first anniversary of the Effective Date and thereafter,
the Term of Employment shall be automatically renewed for a one-year period on
each anniversary of the Effective Date thereafter, unless, in each case, either
Party has notified the other Party in writing in accordance with 


                                       2
<PAGE>   67

Section 26 below at least 90 days prior to the expiration of the then Term of
Employment that she or it does not want the Term of Employment to so renew.

      3. Position, Duties and Responsibilities.

      The Executive, in her capacity as Vice President, General Counsel and
Secretary of the Company shall faithfully perform for the Company the duties of
said office and shall perform such other duties of an executive, managerial or
administrative nature as shall be specified and designated from time to time by
the CEO consistent with such office. The Executive shall devote substantially
all of her business time and effort to the performance of her duties hereunder.
The Executive, in carrying out her duties under this Agreement, shall report to
the CEO. Notwithstanding anything in this Section 3 to the contrary, nothing
shall preclude the Executive from:

            (1) serving on the boards of directors of a reasonable number of
      other corporations or the boards of a reasonable number of trade
      associations and/or charitable organizations;

            (2) engaging in charitable activities and community affairs; and

            (3) managing her personal investments and affairs; 

provided, however, that such activities do not materially interfere with the
proper performance of her duties and responsibilities hereunder.

      4. Base Salary.

      During the Term of Employment, the Executive shall be paid an annual Base
Salary, payable in accordance with the regular payroll practices of the Company,
of $230,000. The Base Salary may be increased (but not decreased) at any time
and from time to time by action of the Board or by any committee thereof or any
individual having authority to take such action in accordance with the Company's
regular practices. Once increased, any reference to Base Salary herein shall be
a reference to such increased amount.

      5. Bonus.

      (a) During the Term of Employment, in addition to the Base Salary, for
each fiscal year of the Company ending during the Term of Employment, the
Executive shall have the opportunity to receive an annual bonus (an "Annual
Bonus") in an amount of between 30 and 50 percent of Base Salary, as determined
by the CEO, in consultation with the Chairman of the Board. Payment of Annual
Bonus shall be made at the same time that other senior-level executives receive
their annual incentive compensation awards.

      (b) In addition, Executive shall be paid a signing bonus payable at the
end of March 1999, equal in amount, if any, to the difference between $144,000
(representing a bonus of 75% of the Executive's 1998 base salary at Sequa
Corporation, her previous employer, to which she would have been entitled had
she not resigned therefrom) and the amount actually paid by Sequa Corporation
for such bonus; provided, however, that the Company shall in no event pay a
bonus pursuant to this subparagraph (b) in excess of $70,000.


                                       3
<PAGE>   68

      6. Long-Term Incentive Compensation Programs.

      The Executive shall be eligible to participate in the Company's stock
option plans applicable to senior-level executives, the terms, conditions and
eligibility of such plans to be determined by the Board.

      7. [Intentionally omitted]

      8. Employee Benefit Programs.

      (a) During the Term of Employment, the Executive, to the extent she is
eligible, shall be entitled to participate in those employee pension and welfare
benefit plans, programs and/or arrangements applicable to the Executive and made
available to the Company's senior-level executives or to its employees
generally, as such plans, programs and/or arrangements may be in effect from
time to time, including, without limitation, pension, profit-sharing, savings,
medical, dental, hospitalization, short-term disability, long-term disability,
life insurance, accidental death and dismemberment protection, travel accident
insurance, and other employee pension and welfare benefit plans, programs and/or
arrangements that may be sponsored by the Company from time to time.

      (b) During the Term of Employment, the Company shall provide the Executive
with term life insurance with a death benefit of at least two times Base Salary.
The Company shall pay all premiums with respect to such life insurance. Such
life insurance may be provided either through the Company's group life insurance
programs, by an individual policy, or by a combination of both group and
individual policies.

      9. Reimbursement of Business Expenses.

      The Executive is authorized to incur ordinary and reasonable business
expenses in carrying out her duties and responsibilities under the Agreement,
and the Company shall reimburse her for all such ordinary and reasonable
business expenses incurred in connection with carrying out the business of the
Company, subject to documentation in accordance with the Company's policy.

      10. Perquisites.

      (a) During the Term of Employment, the Executive shall be entitled to
participate in the Company's executive fringe benefits applicable to the
Company's senior-level executives in accordance with the terms and conditions of
such arrangements as are in effect from time to time.

      (b) During the Term of Employment, the Company shall provide a car to the
Executive.

      11. Vacation.

      The Executive shall be entitled to paid vacation in accordance with the
Company's vacation policy; provided, however, that the Executive shall be
entitled to not less than four weeks of vacation each year.

      12. Termination of Employment.

      (a) Termination of Employment Due to Death. In the event of the
Executive's death during the Term of Employment, the Term of Employment shall
end as of the date of the Executive's death and her estate and/or beneficiaries,
as the case may be, shall be entitled to the following:


                                       4
<PAGE>   69

            (1) Base Salary earned but not paid prior to the date of her death;

            (2) Annual Bonus with respect to any year prior to the year of her
      death which has been earned but not paid;

            (3) any amounts earned, accrued or owing to the Executive but not
      yet paid under Section 6, 8, 9, 10 or 11 above; and

            (4) other or additional benefits in accordance with applicable
      plans, programs and/or arrangements of the Company.

      (b) Termination of Employment Due to Disability. If the Executive's
employment is terminated due to Disability during the Term of Employment, either
by the Company or by the Executive, the Term of Employment shall end as of the
date of the Executive's termination of employment and the Executive shall be
entitled to the following (but in no event shall the Executive be entitled to
less than the benefits due her under any disability program of the Company for
which she becomes eligible):

            (1) Base Salary earned but not paid prior to the date of the
      termination of the Executive's employment;

            (2) Annual Bonus with respect to any year prior to the year of the
      termination of the Executive's employment which has been earned but not
      paid;

            (3) an amount equal to the sum of 50 percent of Base Salary, at the
      annual rate in effect on the date of the termination of the Executive's
      employment, payable in monthly installments for a period ending on the
      first day of the month following the month in which the Executive attains
      age 65 or recovers from her Disability, whichever occurs earlier, less the
      amount of any disability benefits provided to the Executive under the
      Company's disability program;

            (4) any amounts earned, accrued or owing to the Executive but not
      yet paid under Section 6, 8, 9, 10 or 11 above;

            (5) continued participation, as if the Executive were still an
      employee, in the Company's medical, dental, hospitalization and life
      insurance plans, programs and/or arrangements and in those other employee
      plans, programs and/or arrangements in which she was participating on the
      date of the termination of her employment until she attains age 65 or
      recovers from her Disability, whichever occurs earlier;

                  provided, however, that:

                  (X)   if the  Executive is  precluded  from  continuing  her
                        participation  in any employee  benefit plan,  program
                        or arrangement  as provided in this Section  12(b)(5),
                        she  shall be  provided  with the  after-tax  economic
                        equivalent  of the benefits  provided  under the plan,
                        program  or  arrangement  in which  she is  unable  to
                        participate  for the period  specified in this Section
                        12(b)(5); and

                  (Y)   the economic equivalent of any benefit foregone shall be
                        deemed to be the lowest cost that would be incurred by
                        the Executive in obtaining such benefit herself on an
                        individual basis; and


                                       5
<PAGE>   70

            (6) other or additional benefits in accordance with applicable
      plans, programs and/or arrangements of the Company.

      In no event shall a termination of the Executive's employment for
Disability occur unless the Party terminating her employment gives written
notice to the other Party in accordance with Section 26 below.

      (c) Termination of Employment by the Company for Cause. A termination of
the Executive's employment by the Company for Cause shall not take effect unless
the provisions of this Section 12(c) are complied with and the Board issues a
written determination that the Executive's employment should be terminated for
Cause (a "Determination").

            (1) In accordance with Section 26 below, the CEO shall give the
      Executive a written notice stating his intention to terminate the
      Executive's employment for Cause (the "Cause Notice"). The Cause Notice
      shall:

                  (A) state in detail the particular act or acts or failure or
            failures to act that constitute the grounds on which the proposed
            termination of employment for Cause is based; and

                  (B) be given within four months of the CEO learning of such
            act or acts or failure or failures to act.

            (2) The CEO may temporarily relieve the Executive of her duties and
      responsibilities described in Section 3 above during the period commencing
      on the date the Cause Notice is issued by the CEO and ending on the date
      the Determination is issued by the Board (the "Determination Period").

            (3) The Executive shall have 20 days after the date the Cause Notice
      is actually received by her in which to cure her conduct on which the
      termination of employment for Cause is based, to the extent such cure is
      possible. If the Executive fails to cure such conduct, she shall then be
      entitled to a hearing before the Board. Such hearing shall be held during
      the 20-day period following the date the Executive receives the Cause
      Notice; provided, however, that the Executive requests such hearing during
      the 10-day period following the date the Executive receives the Cause
      Notice. Within five days following the completion of such hearing, the
      Board shall issue a Determination stating whether, in its judgment,
      grounds for Cause as detailed in the Cause Notice exist. If the
      Determination states that such grounds exist, the Executive's employment
      shall be immediately terminated for Cause and the Term of Employment shall
      end as of the date of the termination of the Executive's employment.

            (4) If the Company terminates the Executive's employment for Cause,
      the Executive shall be entitled to the following:

                  (A) Base Salary earned but not paid prior to the date of the
            termination of her employment;

                  (B) any amounts earned, accrued or owing to the Executive but
            not yet paid under Section 6, 8, 9, 10 or 11 above; and

                  (C) other or additional benefits in accordance with applicable
            plans, programs and/or arrangements of the Company.


                                       6
<PAGE>   71

            (5) Notwithstanding anything herein to the contrary, if, following a
      termination of the Executive's employment by the Company for Cause based
      upon the conviction of the Executive for a felony, such conviction is
      overturned in a final determination on appeal, the Executive shall be
      entitled to the payments and the economic equivalent of the benefits the
      Executive would have received if her employment had been terminated by the
      Company without Cause.

      (d) Termination of Employment by the Company Without Cause. If the
Executive's employment is terminated by the Company without Cause, other than
due to death or Disability, the Executive shall be entitled to the following:

            (1) Base Salary earned but not paid prior to the date of the
      termination of her employment;

            (2) Annual Bonus with respect to any year prior to the year of the
      termination of the Executive's employment which has been earned but not
      paid;

            (3) an amount equal to the aggregate Base Salary (based on the Base
      Salary in effect on the date of the termination of the Executive's
      employment) (the "Salary Continuation Benefits") with respect to a period
      equal to twelve months, if such termination occurs prior to the first
      anniversary of the initial Effective Date or eighteen months, thereafter,
      in each case payable in equal monthly installments over such period;

            (4) continued accrual of credited service through the end of the
      Term of Employment for the purpose of any Company pension plan, program or
      arrangement;

            (5) the right to purchase, at fair market value, the Executive's
      automobile (if any) provided to him by the Company under the Company's
      automobile perquisite program for senior-level executives;

            (6) any amounts earned, accrued or owing to the Executive but not
      yet paid under Section 6, 8, 9, 10 or 11 above;

            (7) continued participation, as if she were still an employee, in
      the Company's medical, dental, hospitalization and life insurance plans,
      programs and/or arrangements and in other employee benefit plans, programs
      and/or arrangements in which she was participating on the date of the
      termination of her employment until the earlier of:

                  (A) the end of the period used to determine the Salary
            Continuation Benefits; or

                  (B) the date, or dates, she receives equivalent coverage and
            benefits under the plans, programs and/or arrangements of a
            subsequent employer (such coverage and benefits to be determined on
            a coverage-by-coverage or benefit-by-benefit basis);

                        provided, however, that:

                        (X)   if the Executive is precluded from continuing her
                              participation in any employee benefit plan,
                              program or arrangement as provided in Section
                              12(d)(7) above, she shall be provided with the
                              after-tax economic equivalent of the benefits
                              provided under the plan,


                                       7
<PAGE>   72

                              program or arrangement in which she is unable to
                              participate for the period specified in this
                              Section 12(d)(7); and

                        (Y)   the economic equivalent of any benefit foregone
                              shall be deemed to be the lowest cost that would
                              be incurred by the Executive in obtaining such
                              benefit herself on an individual basis; and

            (8) other or additional benefits in accordance with applicable
      plans, programs and/or arrangements of the Company.

      (e) Termination of Employment by the Executive for Good Reason. The
Executive may terminate her employment for Good Reason, but only if:

            (1) the Executive notifies the Board during the 60-day period
      following the date of the first occurrence of an event which constitutes
      Good Reason (the "Good Reason Event Date") of her intention to terminate
      her employment for Good Reason;

            (2) the Executive terminates her employment for Good Reason during
      the 120-day period following the Good Reason Event Date;

            (3) the termination of employment for Good Reason does not occur
      during a Determination Period described in Section 12(c)(2) above; and

            (4) the Good Reason first occurs before or after a Determination
      Period, or, if the Good Reason first occurs during a Determination Period,
      such event constituting Good Reason continues to occur after the
      Determination Period.

      Upon a termination by the Executive of her employment for Good Reason, the
Executive shall be entitled to the same payments and benefits as provided in
Section 12(d) above; provided, however, that if the Executive terminates her
employment for Good Reason based on a reduction in Base Salary under Section
l(k)(2) above, then the Base Salary to be used in determining the Salary
Continuation Benefits in accordance with Section 12(d)(3) above shall be the
Base Salary in effect immediately prior to such reduction.

      (f) Termination of Employment by the Executive Without Good Reason. If the
Executive terminates her employment without Good Reason, other than a
termination of employment due to death or retirement or Disability, the
Executive shall have the same entitlements as provided in Section 12(c)(4)
above. A termination of the Executive's employment under this Section 12(f)
shall be effective upon 30 days prior written notice to the Company and shall
not be deemed a breach of this Agreement.

      (g) Non Renewal of Agreement by Company. If the Company notifies the
Executive, pursuant to Section 2 above, that it does not want the Term of
Employment to renew, the Executive shall have the same entitlements as provided
in Section 12(d) above as if the Executive had been terminated without cause as
of the last day of the then Term of Employment.

      (h) Termination of Employment by Executive due to Relocation of Work
Location. In the event that the Executive's principal work location is moved
outside of the States of New York, New Jersey, Connecticut, Pennsylvania,
Delaware, Maryland or the District of Columbia, the Executive may terminate her
employment with the Company. If the Executive terminates her employment pursuant
to this Section 12(h), she shall have the same entitlements as provided in
Section 12(d) above; provided, that all such benefits, including, without
limitation, the Salary Continuation Benefits, shall be provided for a 


                                       8
<PAGE>   73

period equal to the corresponding severance period listed on Schedule A, payable
in equal monthly installments during such period.

      (i) No Mitigation; No Offset. If the Executive's employment terminates
under this Section 12, the Executive shall be under no obligation to seek other
employment and there shall be no offset against amounts due the Executive under
this Agreement on account of any remuneration attributable to any subsequent
employment that she may obtain except as specifically provided in this Section
12.

      (j) Nature of Payments. Any amounts due under this Section 12 are in the
nature of severance payments considered to be reasonable by the Company and are
not in the nature of a penalty.

      13. Confidentiality; Assignment of Rights.

      (a) During the Term of Employment and thereafter, the Executive shall not
disclose to anyone or make use of any trade secret or proprietary or
confidential information of the Company, including such trade secret or
proprietary or confidential information of any customer or other entity to which
the Company owes an obligation not to disclose such information, which she
acquires during the Term of Employment, including but not limited to records
kept in the ordinary course of business, except (i) as such disclosure or use
may be required or appropriate in connection with her work as an employee of the
Company, (ii) when required to do so by a court of law, by any governmental
agency having supervisory authority over the business of the Company or by any
administrative or legislative body (including a committee thereof) with apparent
jurisdiction to order her to divulge, disclose or make accessible such
information, or (iii) as to such confidential information that becomes generally
known to the public or trade without violation of this Section 13(a).

      (b) The Executive hereby sells, assigns and transfers to the Company all
of her right, title and interest in and to all inventions, discoveries,
improvements and copyrightable subject matter (the "rights") which during the
Term of Employment are made or conceived by her, alone or with others, and which
are within or arise out of any general field of the Company's business or arise
out of any work she performs or information she receives regarding the business
of the Company while employed by the Company. The Executive shall fully disclose
to the Company as promptly as available all information known or possessed by
her concerning the rights referred to in the preceding sentence, and upon
request by the Company and without any further remuneration in any form to her
by the Company, but at the expense of the Company, execute all applications for
patents and for copyright registration, assignments thereof and other
instruments and do all things which the Company may deem necessary to vest and
maintain in it the entire right, title and interest in and to all such rights.

      14. Noncompetition.

      (a) The Executive covenants and agrees that during the Term of Employment
and, following the termination of the Executive's employment with the Company,
for a period of eighteen months or, in the case of a termination pursuant to
Section 12(h), a period equal to the shorter of (i) twice the corresponding
severance period listed on Schedule A and (ii) eighteen months, she shall not at
any time, without the prior written consent of the Company, directly or
indirectly, engage in a Competitive Activity.

      (b) The Parties acknowledge that in the event of a breach or threatened
breach of Section 14(a) above, the Company shall not have an adequate remedy at
law. Accordingly, in the event of any breach or threatened breach of Section
14(a) above, the Company shall be entitled to such equitable and injunctive
relief as may be available to restrain the Executive and any business, firm,
partnership, individual, corporation or entity participating in the breach or
threatened breach from the violation of the provisions of Section 14(a) above.
Nothing in this Agreement shall be construed as prohibiting the 


                                       9
<PAGE>   74

Company from pursuing any other remedies available at law or in equity for
breach or threatened breach of Section 14(a) above, including the recovery of
damages.

      15. Indemnification.

      (a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of the
fact that she is or was a director, officer or employee of the Company or is or
was serving at the request of the Company as a director, officer, member,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to employee benefit plans,
whether or not the basis of such Proceeding is the Executive's alleged action in
an official capacity while serving as a director, officer, member, employee or
agent, the Executive shall be indemnified and held harmless by the Company to
the fullest extent legally permitted or authorized by the Company's certificate
of incorporation or bylaws or resolutions of the Company's Board of Directors
or, if greater, by the laws of the State of Delaware, against all cost, expense,
liability and loss (including, without limitation, attorney's fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Executive in connection
therewith, and such indemnification shall continue as to the Executive even if
she has ceased to be a director, member, employee or agent of the Company or
other entity and shall inure to the benefit of the Executive's heirs, executors
and administrators. The Company shall advance to the Executive all reasonable
costs and expenses incurred by her in connection with a Proceeding within 20
days after receipt by the Company of a written request for such advance. Such
request shall include an undertaking by the Executive to repay the amount of
such advance if it shall ultimately be determined that she is not entitled to be
indemnified against such costs and expenses.

      (b) Neither the failure of the Company (including the Board, independent
legal counsel or stockholders) to have made a determination prior to the
commencement of any Proceeding concerning payment of amounts claimed by the
Executive under Section 15(a) above that indemnification of the Executive is
proper because she has met the applicable standard of conduct, nor a
determination by the Company (including the Board, independent legal counsel or
stockholders) that the Executive has not met such applicable standard of
conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct.

      (c) The Company agrees to continue and maintain a directors and officers'
liability insurance policy covering the Executive to the extent the Company
provides such coverage for its other executive officers.

      16. Effect of Agreement on Other Benefits.

      Except as specifically provided in this Agreement, the existence of this
Agreement shall not prohibit or restrict the Executive's entitlement to full
participation in the Company's employee benefit plans, programs and arrangements
applicable to the Company's senior-level executives.

      17. Assignability; Binding Nature.

      This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Company; provided, however, that the
assignee or transferee is the successor to all or substantially all of the
assets of 


                                       10
<PAGE>   75

the Company and such assignee or transferee assumes the liabilities, obligations
and duties of the Company, as contained in this Agreement, either contractually
or as a matter of law. The Company further agrees that, in the event of a sale
of assets or liquidation as described in the preceding sentence, it shall take
whatever action it legally can in order to cause such assignee or transferee to
expressly assume the liabilities, obligations and duties of the Company
hereunder or under any other plan or benefit program referred to herein. No
rights or obligations of the Executive under this Agreement may be assigned or
transferred by the Executive other than her rights to compensation and benefits,
which may be transferred only by will or operation of law, except as provided in
Section 23 below.

      18. Representation.

      The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization. The Executive represents that she knows
of no agreement between her and any other person, firm or organization that
would be violated by the performance of her obligations under this Agreement.

      19. Entire Agreement.

      This Agreement contains the entire understanding and agreement between the
Parties concerning the subject matter hereof and supersedes all prior
agreements, understandings, discussions, negotiations and undertakings, whether
written or oral, between the Parties, including, without limitation, a certain
offer letter, dated November 16, 1998, by and between the Parties, with respect
thereto.

      20. Amendment or Waiver.

      No provision in this Agreement may be amended unless such amendment is
agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be.

      21. Severability.

      In the event that any provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason, in whole or in part,
the remaining provisions of this Agreement shall be unaffected thereby and shall
remain in full force and effect and such provision or portion of this Agreement
shall remain in effect to the fullest extent permitted by law.

      22. Survivorship.

      The respective rights and obligations of the Parties hereunder shall
survive any termination of the Executive's employment to the extent necessary to
the intended preservation of such rights and obligations.

      23. Beneficiaries/References.

      The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death


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<PAGE>   76

or a judicial determination of her incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to her beneficiary,
estate or other legal representative.

      24. Governing Law/Submission to Jurisdiction.

      This Agreement shall be governed by and construed and interpreted in
accordance with the laws of New York without reference to principles of conflict
of laws. Each of the Company and the Executive hereby irrevocably and
unconditionally: (i) submits for itself or herself, as applicable, and its or
her property in any legal action or proceeding relating to this Agreement, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof; (ii) consents that any such action or
proceeding may be brought in such courts, and waives any objection that it or
she may now or hereafter have to the venue of any such action or proceeding in
any such court or that such action or proceeding was brought in an inconvenient
forum and agrees not to plead or claim the same; (iii) agrees that service of
process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, at its or her address set forth in or designated
pursuant to Section 26 hereof; and (iv) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.

      25. Resolution of Disputes.

      Any disputes arising under or in connection with the Agreement, other than
disputes arising in connection with Sections 14 or 15 hereof, may, at the
election of the Executive or the Company, be resolved by binding arbitration, to
be held in New York City in accordance with the rules and procedures of the
American Arbitration Association. If arbitration is elected, the Executive and
the Company shall mutually select the arbitrator. If the Executive and the
Company cannot agree on the selection of an arbitrator, each Party shall select
an arbitrator and the two arbitrators shall select a third arbitrator, and the
three arbitrators shall form an arbitration panel which shall resolve the
dispute by majority vote. Judgment upon the award rendered by the arbitrator(s)
may be entered in any court having jurisdiction thereof. Costs of the
arbitration or litigation, including, without limitation, reasonable attorneys'
fees of both Parties, shall be borne by the Company; provided, however, that, if
a dispute is resolved in favor of the Company, the Executive shall bear her own
costs of the arbitration or litigation and shall reimburse the Company for the
Executive's costs of the arbitration or litigation previously paid by the
Company. Pending the resolution of any arbitration or court proceeding, the
Company shall continue payment of all amounts due the Executive under this
Agreement and all benefits to which the Executive is entitled at the time the
dispute arises.

      26. Notices.

      Any notice given to a Party shall be in writing and shall be deemed to
have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the Party
concerned at the address indicated below or to such changed address as such
Party may subsequently give such notice of:

If to the Company:            Metallurg, Inc.
                              6 East 43rd Street, 12th floor
                              New York, New York 10017
                              Attention: President and Chief Executive Officer


                                       12
<PAGE>   77

With a copy to:               Rogers & Wells LLP
                              200 Park Avenue
                              New York, New York 10166
                              Attention: Samuel M. Feder

If to the Executive:          Ellen T. Harmon
                              c/o Metallurg, Inc.
                              6 East 43rd Street, 12th Floor
                              New York, New York 10017

      27. Headings.

      The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

      28. Counterparts.

      This Agreement may be executed in two or more counterparts.


                                       13
<PAGE>   78

      IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.

                                    METALLURG, INC.

                                    By: /s/ Alan D. Ewart
                                        ----------------------------------
                                    Name: Alan D. Ewart
                                    Title: President

AGREED AND ACCEPTED

/s/ Ellen T. Harmon
-------------------------------
       Ellen T. Harmon


                                       14
<PAGE>   79

                                   SCHEDULE A

<TABLE>
<CAPTION>
               Years of Service               Severance Period
               ----------------               ----------------
                 <S>                              <C>
                 Up To 15                         6 months
                 More Than 15                     9 months
                 More Than 20                     12 months
</TABLE>


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