Document:

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                              EMPLOYMENT AGREEMENT

                            DATED AS OF JUNE 3, 2003

              BETWEEN BERNARD CAMMARATA AND THE TJX COMPANIES, INC.

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                                      INDEX

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                                                                                                                    PAGE
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1.       EFFECTIVE DATE; TERM OF AGREEMENT........................................................................    1
2.       SCOPE OF EMPLOYMENT......................................................................................    1
3.       COMPENSATION AND BENEFITS................................................................................    2
4.       TERMINATION OF EMPLOYMENT; IN GENERAL....................................................................    3
5.       BENEFITS UPON NON-VOLUNTARY TERMINATION OF EMPLOYMENT OR UPON EXPIRATION OF THE AGREEMENT................    3
6.       OTHER TERMINATION; VIOLATION OF CERTAIN AGREEMENTS.......................................................    5
7.       BENEFITS UPON CHANGE IN CONTROL..........................................................................    5
8.       AGREEMENT NOT TO SOLICIT OR COMPETE......................................................................    5
9.       ASSIGNMENT...............................................................................................    7
10.      NOTICES..................................................................................................    7
11.      WITHHOLDING..............................................................................................    7
12.      GOVERNING LAW............................................................................................    7
13.      ARBITRATION..............................................................................................    7
14.      ENTIRE AGREEMENT.........................................................................................    8

EXHIBIT A
         CERTAIN DEFINITIONS............................................................... ......................  A-1

EXHIBIT B
         DEFINITION OF CHANGE IN CONTROL.......................................... ...............................  B-1

EXHIBIT C
         CHANGE IN CONTROL BENEFITS.................................................. ............................  C-1
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                                                               BERNARD CAMMARATA

                              EMPLOYMENT AGREEMENT

         AGREEMENT dated as of June 3, 2003 between BERNARD CAMMARATA of 73
Captain Miles Lane, Concord, Massachusetts 01742 ("Executive") and The TJX
Companies, Inc., a Delaware corporation whose principal office is in Framingham,
Massachusetts 01701.

                                    RECITALS

         Executive has been employed by The TJX Companies, Inc. (the "Company")
as Chairman of the Board and in other executive capacities, most recently
pursuant to an employment agreement dated as of April 17, 2000 (the "Prior
Agreement"). The Company and Executive intend that Executive shall continue to
serve the Company as Chairman of the Board on the terms set forth below and, to
that end, deem it desirable and appropriate to enter into this Agreement.

                                    AGREEMENT

         The parties hereto, in consideration of the mutual agreements
hereinafter contained, agree as follows:

1.       EFFECTIVE DATE; TERM OF AGREEMENT. This Agreement shall become
effective as of June 3, 2003 (the "Effective Date") and, as of that date, shall
supersede the Prior Agreement. Executive's employment as Chairman of the Board
shall continue on the terms provided herein until the date of the annual meeting
of stockholders of the Company occurring in 2006 (the "2006 meeting date"),
subject to earlier termination as provided herein (such period of employment
hereinafter called the "Employment Period").

2.       SCOPE OF EMPLOYMENT.

         (a)      Nature of Services. During the term hereof, Executive shall
diligently perform the duties and assume the responsibilities of Chairman of the
Board and such additional executive duties and responsibilities (other than
those of the Chief Executive Officer of the Company) as shall from time to time
be assigned to him by the Board. In any matter in which the Board deliberates or
takes action with respect to this Agreement, Executive, if then a member of the
Board, shall recuse himself.

         (b)      Extent of Services. Executive shall devote such time and
efforts as are reasonably necessary to the proper performance of his duties
hereunder, it being understood that such duties are not expected to require
Executive's full-time attention and that Executive may, during the Employment
Period, participate in other activities (including, without limitation,
charitable or community activities, activities in trade or professional
organizations, service on other boards or

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similar bodies, and investments in other enterprises), provided that such other
activities (i) would be permitted under Section 8 if engaged in by Executive
during the three-year period following a voluntary termination of employment
(during the Employment Period) other than for Valid Reason, and (ii) are not
otherwise inconsistent with Executive's position, duties and responsibilities
hereunder.

3.       COMPENSATION AND BENEFITS.

         (a)      Base Salary. Executive shall be paid a Base Salary at the rate
of $400,000 per year, such Base Salary to be paid in the same manner and at the
same times as the Company shall pay base salary to other executive employees.

         (b)      Existing Awards Under Stock Incentive Plan. Reference is made
to the following stock option awards previously made to Executive under the
Company's Stock Incentive Plan (including any successor, the "Stock Incentive
Plan") which were outstanding as of the Effective Date: Grant Nos. 86-51, 86-55
and 86-56. Each of the stock option awards referenced in the preceding sentence
shall continue for such period or periods and in accordance with such terms as
are set out in the grant and other governing documents relating to such awards
(including for this purpose the Prior Agreement insofar as they relate to any
such awards), and shall not be affected by the terms of this Agreement except as
otherwise expressly provided herein.

         (c)      Continued Participation in Certain Benefits. During the
Employment Period, Executive shall continue to be eligible to participate in the
employee benefit and fringe benefit plans and programs in effect on the date
hereof and made available to executives of the Company generally (including,
without limitation, GDCP and ESP (subject to clause (iii) below)), in each case
in accordance with the terms of such plans or programs as in effect from time to
time, subject to the following:

                  (i)      Executive shall not be entitled to participate in any
         awards under the Company's Long Range Performance Incentive Plan or
         under the Company's Management Incentive Plan for periods or cycles
         commencing on or after January 30, 2000.

                  (ii)     Except as provided at Section 3(b) above, Executive
         shall not be entitled to participate in any awards under the Stock
         Incentive Plan.

                  (iii)    Executive shall not be entitled to any employer
         credits under ESP.

                  (iv)     Executive shall have no rights to benefits under the
         Company's Supplemental Executive Retirement Plan ("SERP").

Except as provided in Section 3(c)(iii) above, Executive's entitlement to
benefits, if any, under those Company employee and fringe benefit plans and
programs in which he participates will be determined in accordance with the
terms of the applicable plan or program.

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4.       TERMINATION OF EMPLOYMENT; IN GENERAL.

         (a)      The Company shall have the right to end Executive's employment
at any time and for any reason, with or without Cause.

         (b)      The Employment Period shall terminate when Executive becomes
Disabled. In addition, if by reason of Incapacity Executive is unable to perform
his duties for at least six continuous months, upon written notice by the
Company to Executive the Employment Period will be terminated for Incapacity.

         (c)      The Employment Period shall terminate if Executive shall fail
to be nominated to serve, or shall fail to be elected to serve, as a member of
the Board.

         (d)      Whenever the Employment Period shall terminate, Executive
shall resign all offices or other positions he shall hold with the Company and
any affiliated corporations, including all positions on the Board.

5.       BENEFITS UPON NON-VOLUNTARY TERMINATION OF EMPLOYMENT OR UPON
EXPIRATION OF THE AGREEMENT.

         (a)      Certain Terminations Prior to the 2006 meeting date. If the
Employment Period shall have terminated prior to the 2006 meeting date by reason
of (i) death, Disability or Incapacity of Executive, (ii) termination by the
Company for any reason other than Cause or (iii) termination by Executive in the
event that either (A) Executive shall be removed from or fail to be reelected as
a Director or as Chairman, or (B) Executive is relocated more than forty (40)
miles from the current corporate headquarters of the Company, in either case
without his prior written consent, then all compensation and benefits for
Executive shall be as follows:

                  (i)      For the longer of twelve (12) months after such
         termination or until the 2006 meeting date (the "termination period"),
         the Company will pay to Executive or his legal representative continued
         Base Salary at the rate in effect at termination of employment, subject
         to the following:

                           (A)      If Executive is eligible for long-term
                  disability compensation benefits under the Company's long-term
                  disability plan or any successor Company long-term disability
                  plan, the amount payable under this clause shall be paid at a
                  rate equal to the excess of (I) the rate of Base Salary in
                  effect at termination of employment, over (II) the long-term
                  disability compensation benefits for which Executive is
                  eligible under such plan.

                           (B)      Payments pursuant to this clause (a)(i)
                  shall be paid for the first twelve (12) months of the
                  termination period without reduction for compensation earned
                  from other employment or self-employment, and shall thereafter
                  be reduced by such compensation received by Executive from
                  other employment or self-employment.

                  (ii)     Until the expiration of the termination period as
         defined at (a)(i) above and subject to such minimum
         coverage-continuation requirements as may be required by law,

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         the Company will provide (except to the extent that Executive shall
         obtain no less favorable coverage from another employer or from
         self-employment) such medical and hospital insurance and term life
         insurance for Executive and his family, comparable to the insurance
         provided for executives generally, as the Company shall determine, and
         upon the same terms and conditions as the same shall be provided for
         other Company executives generally; provided, however, that in no event
         shall such benefits or the terms and conditions thereof be less
         favorable to Executive than those afforded to him as of the Date of
         Termination; and further provided, that to the extent it is impossible
         or impracticable to provide any such coverage to Executive under the
         Company's then existing employee benefit plans or arrangements, the
         Company shall arrange alternative comparable coverage or, if such
         alternative coverage is not available, shall pay to Executive the cost
         of such coverage, all as reasonably determined by the Committee.

                  (iii)    In addition, the Company will pay to Executive or his
         legal representative such vested amounts as shall have been deferred
         for Executive's account (but not received) under GDCP in accordance
         with its terms plus such amounts, if any, as shall then remain credited
         to Executive's account under ESP. As of the Effective Date, Executive
         was not a participant in either GDCP or ESP.

                  (iv)     Executive or his legal representative shall be
         entitled to the benefits described in Sections 3(b) (Other Existing
         Options) and to his benefits under the Company's tax qualified
         Retirement Plan and Savings/Profit-Sharing Plan (such qualified-plan
         benefits being hereinafter referred to as Executive's "Qualified-Plan
         Benefits").

                  (v)      If termination occurs by reason of Incapacity or
         Disability, Executive shall be entitled to such compensation, if any,
         as is payable pursuant to the Company's long-term disability plan or
         any successor Company disability plan. If for any period Executive
         receives long-term disability compensation payments under a long-term
         disability plan of the Company as well as payments under (a)(i) above,
         and if the sum of such payments (the "combined salary/disability
         benefit") exceeds the payment for such period to which Executive is
         entitled under (a)(i) above (determined without regard to paragraph (A)
         thereof), he shall promptly pay such excess in reimbursement to the
         Company; provided, that in no event shall application of this sentence
         result in reduction of Executive's combined salary/disability benefit
         below the level of long-term disability compensation payments to which
         Executive is entitled under the long-term disability plan or plans of
         the Company.

                  (vi)     Except as expressly set forth above or as required by
         law, Executive shall not be entitled to continue participation during
         the termination period in any employee benefit or fringe benefit plans,
         other than a Company-provided automobile or automobile allowance.

         (b)      Terminations on or after the 2006 meeting date. Unless earlier
terminated or except as otherwise mutually agreed by Executive and the Company,
Executive's employment with the Company shall terminate on the 2006 meeting
date. Unless the Company in connection with such termination shall offer to
Executive continued service in a position acceptable to

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Executive and upon mutually and reasonably agreeable terms, Executive shall be
entitled upon such termination to receive, for the period beginning on such
termination and ending on the date of the annual meeting of stockholders
occurring in 2007, continuation of Base Salary at the rate in effect at
termination of employment plus medical, dental and life-insurance coverage (but
not including continued participation in the Company's retirement or 401(k)
plan(s) or continued participation in any other employee or fringe benefit plan
or program, other than a Company-provided automobile or automobile allowance)
comparable to the benefits of such type to which he was entitled at time of
termination; provided, that to the extent it is impossible or impracticable to
provide any such benefits to Executive under the Company's then existing
employee benefit plans or arrangements, the Company shall arrange for
alternative comparable coverage or, if such alternative coverage is not
available, shall pay to Executive the cost of such coverage, all as reasonably
determined by the Committee. If the Company in connection with such termination
offers to Executive continued service in a position acceptable to Executive and
upon mutually and reasonably agreeable terms, and Executive declines such
service, he shall be treated for all purposes of this Agreement as having
terminated his employment voluntarily on the 2006 meeting date and he shall be
entitled only to those benefits to which he would be entitled under Section 6(a)
("Voluntary termination of employment"). For purposes of the two preceding
sentences, "service in a position acceptable to Executive" shall mean service as
Chairman or service in such other position, if any, as may be acceptable to
Executive.

6.       OTHER TERMINATION; VIOLATION OF CERTAIN AGREEMENTS.

         (a)      Voluntary termination of employment. If Executive terminates
his employment voluntarily, Executive or his legal representative shall be
entitled (in each case in accordance with and subject to the terms of the
applicable arrangement) to the following: (i) such vested amounts as are
credited to Executive's account (but not received) under GDCP and ESP; (ii) any
benefits described at Sections 3(b) (Other Existing Options), and (iii)
Executive's Qualified-Plan Benefits. No other benefits shall be paid under this
Agreement upon a voluntary termination of employment.

         (b)      Termination for Cause; violation of certain agreements. If the
Company should end Executive's employment for Cause, or, notwithstanding Section
5 and Section 6(a) above, if Executive should violate the protected persons or
noncompetition provisions of Section 8, all compensation and benefits otherwise
payable pursuant to this Agreement shall cease, other than the benefits
described at (a) above. The Company does not waive any rights it may have for
damages or for injunctive relief.

7.       BENEFITS UPON CHANGE IN CONTROL. Notwithstanding any other provision of
this Agreement, in the event of a Change of Control, the determination and
payment of any benefits payable thereafter with respect to Executive shall be
governed exclusively by the provisions of Exhibit C.

8.       AGREEMENT NOT TO SOLICIT OR COMPETE.

         (a)      Upon the termination of employment at any time, then for a
period of two years after the termination of the Employment Period, Executive
shall not under any circumstances employ, solicit the employment of, or accept
unsolicited the services of, any "protected person"

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or recommend the employment of any "protected person" to any other business
organization. A "protected person" shall be a person known by Executive to be
employed by the Company or its Subsidiaries or to have been employed by Company
or its Subsidiaries within six months prior to the commencement of conversations
with such person with respect to employment.

         As to (i) each "protected person" to whom the foregoing applies, (ii)
each subcategory of "protected person" as defined above, (iii) each limitation
on (A) employment, (B) solicitation and (C) unsolicited acceptance of services,
of each "protected person" and (iv) each month of the period during which the
provisions of this subsection (a) apply to each of the foregoing, the provisions
set forth in this subsection (a) are deemed to be separate and independent
agreements and in the event of unenforceability of any such agreement, such
unenforceable agreement shall be deemed automatically deleted from the
provisions hereof and such deletion shall not affect the enforceability of any
other provision of this subsection (a) or any other term of this Agreement.

         Notwithstanding the foregoing provisions of this Section 8(a), upon
automatic termination of the Employment Period on the 2006 meeting date, or if
Executive should end his employment voluntarily at any time, including by reason
of retirement or disability but not including a voluntary termination for Valid
Reason, or if the Company should end Executive's employment at any time for
Cause, then the restrictions of this Section 8(a) shall apply for three (3)
years thereafter rather than for the two years referenced in the first paragraph
hereof.

         (b)      During the course of his employment, Executive will have
learned many trade secrets of the Company and will have access to confidential
information and business plans for the Company. Therefore, upon termination of
the Employment Period on the 2006 meeting date or if Executive should earlier
end his employment voluntarily at any time, including by reason of retirement or
Disability but not including a voluntary termination for Valid Reason, or if the
Company should end Executive's employment at any time for Cause, then for a
period of three (3) years thereafter, Executive will not engage, either as a
principal, employee, partner, consultant or investor (other than a less-than-1%
equity interest in an entity), in a business which is a competitor of the
Company. A business shall be deemed a competitor of the Company if and only (i)
if it shall then be so regarded by retailers generally, or (ii) if it shall
operate a promotional off-price family apparel and/or home furnishings store
within ten (10) miles of any "then existing or proposed Company store" or (iii)
if it shall operate an on-line, "e-commerce" or other internet-based off-price
family apparel and/or home furnishings business; provided, that a business shall
be deemed a competitor of the Company under clause (iii) only if the Company is
then also operating an on-line, "e-commerce" or other internet-based off-price
family apparel and/or home furnishings business; and further provided, that a
business shall be deemed a competitor of the Company by reason of engaging in a
promotional off-price home-furnishing business only if the Company is then also
engaged in such a business. The term "then existing or proposed Company store"
in the previous sentence shall refer to any such store that is, at the time of
termination of the Employment Period, operated by the Company or any direct or
indirect subsidiary of the Company or under lease for operation as aforesaid.
Nothing herein shall restrict the right of Executive to engage in a business
that operates a conventional or full mark-up department store. Executive agrees
that if, at any time, pursuant to action of any court, administrative or
governmental body or other arbitral tribunal, the operation of any part of this
paragraph shall be determined to be unlawful or otherwise unenforceable, then
the coverage of this paragraph shall be deemed to be restricted as to duration,
geographical scope or otherwise,

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as the case may be, to the extent, and only to the extent, necessary to make
this paragraph lawful and enforceable in the particular jurisdiction in which
such determination is made.

         (c)      If the Employment Period terminates, Executive agrees (i) to
notify the Company immediately upon his securing employment or becoming
self-employed during any period when Executive's compensation from the Company
shall be subject to reduction or his benefits provided by the Company shall be
subject to termination as provided in Section 6 and (ii) to furnish to the
Company written evidence of his compensation earned from any such employment or
self-employment as the Company shall from time to time request. In addition,
upon termination of the Employment Period for any reason other than the death of
Executive, Executive shall immediately return all written trade secrets,
confidential information and business plans of the Company and shall execute a
certificate certifying that he has returned all such items in his possession or
under his control.

9.       ASSIGNMENT. The rights and obligations of the Company shall enure to
the benefit of and shall be binding upon the successors and assigns of the
Company. The rights and obligations of Executive are not assignable except only
that payments payable to him after his death shall be made by devise or descent.

10.      NOTICES. All notices and other communications required hereunder shall
be in writing and shall be given by mailing the same by certified or registered
mail, return receipt requested, postage prepaid. If sent to the Company the same
shall be mailed to the Company at 770 Cochituate Road, Framingham, Massachusetts
01701, Attention: Chairman of the Executive Compensation Committee, or other
such address as the Company may hereafter designate by notice to Executive; and
if sent to the Executive, the same shall be mailed to Executive at 73 Captain
Miles Lane, Concord, Massachusetts 01742 or at such other address as Executive
may hereafter designate by notice to the Company.

11.      WITHHOLDING. Anything to the contrary notwithstanding, all payments
required to be made by the Company hereunder to Executive shall be subject to
the withholding of such amounts, if any, relating to tax and other payroll
deductions as the Company may reasonably determine it should withhold pursuant
to any applicable law or regulation.

12.      GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be governed by the laws of the Commonwealth of
Massachusetts.

13.      ARBITRATION. In the event that there is any claim or dispute arising
out of or relating to this Agreement, or an alleged breach thereof, and the
parties hereto shall not have resolved such claim or dispute within sixty (60)
days after written notice from one party to the other setting forth the nature
of such claim or dispute, then such claim or dispute shall be settled
exclusively by binding arbitration in Boston, Massachusetts in accordance with
the Rules Governing Resolutions of Employment Disputes of the American
Arbitration Association by an arbitrator mutually agreed upon by the parties
hereto or, in the absence of such agreement, by an arbitrator selected according
to such Rules. Notwithstanding the foregoing, if either the Company or Executive
shall request, such arbitration shall be conducted by a panel of three
arbitrators, one selected by the Company, one selected by Executive and the
third selected by agreement of the first two, or, in the absence of such
agreement, in accordance with such Rules.

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Judgment upon the award rendered by such arbitrator(s) shall be entered in any
Court having jurisdiction thereof upon the application of either party.

14.      ENTIRE AGREEMENT. This Agreement, including Exhibits, represents the
entire agreement between the parties relating to the terms of Executive's
employment by the Company and supersedes all prior written or oral agreements
between them"; provided, that this Agreement shall not be construed as
superseding or modifying the Restoration Agreement dated December 31, 2002
between the Company and Executive and the letter agreement dated December 31,
2002 relating to certain tax matters.

                                                /s/ Bernard Cammarata
                                                --------------------------------
                                                Executive

                                                THE TJX COMPANIES, INC.

                                                By /s/ Edmond J. English
                                                --------------------------------

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                                    EXHIBIT A

                               Certain Definitions

         In this Agreement, the following terms shall have the following
meanings:

         (a)      "Base Salary" means, for any period, the amount described in
Section 3(a).

         (b)      "Board" means the Board of Directors of the Company.

         (c)      "Committee" means the Executive Compensation Committee of the
Board.

         (d)      "Cause" means dishonesty by Executive in the performance of
his duties, conviction of a felony (other than a conviction arising solely under
a statutory provision imposing criminal liability upon Executive on a per se
basis due to the Company offices held by Executive, so long as any act or
omission of Executive with respect to such matter was not taken or omitted in
contravention of any applicable policy or directive of the Board), gross neglect
of duties (other than as a result of Disability or death), or conflict of
interest which conflict shall continue for thirty (30) days after the Company
gives written notice to Executive requesting the cessation of such conflict.

         In respect of any termination during a Standstill Period, Executive
shall not be deemed to have been terminated for Cause until the later to occur
of (i) the 30th day after notice of termination is given and (ii) the delivery
to Executive of a copy of a resolution duly adopted by the affirmative vote of
not less than a majority of the Company's directors at a meeting called and held
for that purpose (after reasonable notice to Executive), and at which Executive
together with his counsel was given an opportunity to be heard, finding that the
Executive was guilty of conduct described in the definition of "Cause" above,
and specifying the particulars thereof in detail; provided, however, that the
Company may suspend Executive and withhold payment of his Base Salary from the
date that notice of termination is given until the earliest to occur of (A)
termination of Executive for Cause effected in accordance with the foregoing
procedures (in which case Executive shall not be entitled to his Base Salary for
such period), (B) a determination by a majority of the Company's directors that
Executive was not guilty of the conduct described in the definition of "Cause"
effected in accordance with the foregoing procedures (in which case Executive
shall be reinstated and paid any of his previously unpaid Base Salary for such
period), or (C) ninety (90) days after notice of termination is given (in which
case Executive shall then be reinstated and paid any of his previously unpaid
Base Salary for such period). If Base Salary is withheld and then paid pursuant
to clauses (B) and (C) of the preceding sentence, the amount thereof shall be
accompanied by simple interest, calculated on a daily basis, at a rate per annum
equal to the prime or base lending rate, as in effect at the time, of the
Company's principal commercial bank.

         (e)      "Change of Control" has the meaning given it in Exhibit B.

         (f)      "Change of Control Termination" means the termination of
Executive's employment during a Standstill Period (1) by the Company other than
for Cause, or (2) by Executive for good reason, or (3) by reason of death,
Incapacity or Disability.

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         For purposes of this definition, termination for "good reason" shall
mean the voluntary termination by Executive of his employment (A) within one
hundred and twenty (120) days after the occurrence without Executive's express
written consent of any one of the events described in clauses (I), (II), (III),
(IV), (V) or (VI) below, provided, that Executive gives notice to the Company at
least thirty (30) days in advance requesting that the pertinent situation
described therein be remedied, and the situation remains unremedied upon
expiration of such 30-day period; (B) within one hundred and twenty (120) days
after the occurrence without Executive's express written consent of the event
described in clause (VII), provided, that Executive gives notice to the Company
at least thirty (30) days in advance of his intent to terminate his employment
in respect of such event; or (C) under the circumstances described in clause
(VIII) below, provided that Executive gives notice to the Company at least
thirty (30) days in advance:

         (I)      the assignment to him of any duties inconsistent with his
                  positions, duties, responsibilities, reporting requirements,
                  and status with the Company immediately prior to the Change of
                  Control, or any removal of Executive from or any failure to
                  reelect him to such positions, except in connection with the
                  termination of Executive's employment by the Company for Cause
                  or by Executive other than for good reason, or any other
                  action by the Company which results in a diminishment in such
                  position, authority, duties or responsibilities, other than an
                  insubstantial and inadvertent action which is remedied by the
                  Company promptly after receipt of notice thereof given by
                  Executive; or

         (II)     if Executive's rate of Base Salary for any fiscal year is less
                  than 100% of the rate of Base Salary paid to Executive in the
                  completed fiscal year immediately preceding the Change of
                  Control or if Executive's total cash compensation
                  opportunities, including salary and incentives, for any fiscal
                  year are less than 100% of the total cash compensation
                  opportunities made available to Executive in the completed
                  fiscal year immediately preceding the Change of Control; or

         (III)    the failure of the Company to continue in effect any benefits
                  or perquisites, or any pension, life insurance, medical
                  insurance or disability plan in which Executive was
                  participating immediately prior to the Change of Control
                  unless the Company provides Executive with a plan or plans
                  that provide substantially similar benefits, or the taking of
                  any action by the Company that would adversely affect
                  Executive's participation in or materially reduce Executive's
                  benefits under any of such plans or deprive Executive of any
                  material fringe benefit enjoyed by Executive immediately prior
                  to the Change of Control; or

         (IV)     any purported termination of Executive's employment by the
                  Company for Cause during a Standstill Period which is not
                  effected in compliance with paragraph (d) above; or

         (V)      any relocation of Executive of more than forty (40) miles from
                  the place where Executive was located at the time of the
                  Change of Control; or

         (VI)     any other breach by the Company of any provision of this
                  Agreement; or

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         (VII)    the Company sells or otherwise disposes of, in one transaction
                  or a series of related transactions, assets or earning power
                  aggregating more than 30% of the assets (taken at asset value
                  as stated on the books of the Company determined in accordance
                  with generally accepted accounting principles consistently
                  applied) or earning power of the Company (on an individual
                  basis) or the Company and its Subsidiaries (on a consolidated
                  basis) to any other Person or Persons (as those terms are
                  defined in Exhibit B); or

         (VIII)   The voluntary termination by Executive of his employment at
                  any time within one year after the Change of Control.
                  Notwithstanding the foregoing, the Board may expressly waive
                  the application of this clause (VIII) if it waives the
                  applicability of substantially similar provisions with respect
                  to all persons with whom the Company has a written severance
                  agreement (or may condition its application on any additional
                  requirements or employee agreements which the Board shall in
                  its discretion deem appropriate in the circumstances). The
                  determination of whether to waive or impose conditions on the
                  application of this clause (VIII) shall be within the complete
                  discretion of the Board but shall be made prior to the Change
                  of Control.

         (g)      "Code" means the Internal Revenue Code of 1986, as amended
from time to time.

         (h)      "Date of Termination" means the date on which Executive's
employment terminates.

         (i)      "Disability" has the meaning given it in the Company's
long-term disability plan. Executive's employment shall be deemed to be
terminated for Disability on the date on which Executive is entitled to receive
long-term disability compensation pursuant to such long-term disability plan.

         (j)      "Effective Date" has the meaning set forth in Section 1.

         (k)      "Employment Period" has the meaning set forth in Section 1.

         (l)      "ESP" means the Company's Executive Savings Plan.

         (m)      "GDCP" means the Company's General Deferred Compensation Plan,
or, if the General Deferred Compensation Plan is no longer maintained by the
Company, a nonqualified deferred compensation plan (other than the ESP) or
arrangement the terms of which are not less favorable to Executive than the
terms of the General Deferred Compensation Plan as in effect on the Effective
Date.

         (n)      "Qualified-Plan Benefits" has the meaning set forth in Section
5(a)(iv).

         (o)      "SERP" has the meaning set forth in Section 3(c)(iv).

         (p)      "Incapacity" means a disability (other than Disability within
the meaning of (h) above) or other impairment of health that renders Executive
unable to perform his duties to the reasonable satisfaction of the Committee.

                                      A-3

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                                                                  CONFORMED COPY

         (q)      "Standstill Period" means the period commencing on the date of
a Change of Control and continuing until the close of business on the earlier of
the 2006 meeting date or the last business day of the 24th calendar month
following such Change of Control.

         (r)      "Stock" means the common stock, $1.00 par value, of the
Company.

         (s)      "Stock Incentive Plan" has the meaning set forth in Section
3(b).

         (t)      "Subsidiary" means any corporation in which the Company owns,
directly or indirectly, 50% or more of the total combined voting power of all
classes of stock.

         (u)      "2006 meeting date" has the meaning set forth in Section 1.

         (v)      "Valid Reason" means the voluntary termination by Executive of
his employment (A) within one hundred and twenty (120) days after the occurrence
without Executive's express written consent of any one of the events described
in clauses (I), (II), (III), (IV), or (V) below, provided that Executive gives
notice to the Company at least thirty (30) days in advance requesting that the
pertinent situation described therein be remedied, and the situation remains
unremedied upon expiration of such 30-day period; or (B) within one hundred and
twenty (120) days after the occurrence without Executive's express written
consent of the event described in clause (VI) below:

         (I)      the assignment to him of any duties inconsistent with his
                  positions, duties, responsibilities, reporting requirements,
                  and status with the Company immediately prior to such
                  assignment, or a substantive change in Executive's titles or
                  offices as in effect immediately prior to such assignment, or
                  any removal of Executive from or any failure to reelect him to
                  such positions, except in connection with the termination of
                  Executive's employment by the Company for Cause or by
                  Executive other than for Valid Reason, or any other action by
                  the Company which results in a diminishment in such position,
                  authority, duties or responsibilities, other than an
                  insubstantial and inadvertent action which is remedied by the
                  Company promptly after receipt of notice thereof given by
                  Executive; or

         (II)     the failure of the Company to continue in effect any benefits
                  or perquisites, or any pension, life insurance, medical
                  insurance or disability plan in which Executive was
                  participating immediately prior to such failure unless the
                  Company provides Executive with a plan or plans that provide
                  substantially similar benefits, or the taking of any action by
                  the Company that would adversely affect Executive's benefits
                  under any of such plans or deprive Executive of any material
                  fringe benefit enjoyed by Executive immediately prior to such
                  action, unless the elimination or reduction of any such
                  benefit, perquisite or plan affects all other executives in
                  the same organizational level (it being the Company's burden
                  to establish this fact); or

         (III)    any purported termination of Executive's employment by the
                  Company for Cause which is not effected in compliance with
                  paragraph (d) above; or

                                      A-4

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                                                                  CONFORMED COPY

         (IV)     any relocation of Executive of more than forty (40) miles from
                  the place where Executive was located at the time of such
                  relocation; or

         (V)      any other breach by the Company of any provision of this
                  Agreement; or

         (VI)     the Company sells or otherwise disposes of, in one transaction
                  or a series of related transactions, assets or earning power
                  aggregating more than 30% of the assets (taken at asset value
                  as stated on the books of the Company determined in accordance
                  with generally accepted accounting principles consistently
                  applied) or earning power of the Company (on an individual
                  basis) or the Company and its Subsidiaries (on a consolidated
                  basis) to any other Person or Persons (as those terms are
                  defined in Exhibit B).

                                      A-5

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                                                                  CONFORMED COPY

                                    EXHIBIT B

                        Definition Of "Change Of Control"

         "Change of Control" shall mean the occurrence of any one of the
following events:

         (a)      there occurs a change of control of the Company of a nature
that would be required to be reported in response to Item 1(a) of the Current
Report on Form 8-K pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 (the "Exchange Act") or in any other filing under the Exchange Act;
provided, however, that no transaction shall be deemed to be a Change of Control
(i) if the person or each member of a group of persons acquiring control is
excluded from the definition of the term "Person" hereunder or (ii) unless the
Committee shall otherwise determine prior to such occurrence, if Executive or an
Executive Related Party is the Person or a member of a group constituting the
Person acquiring control; or

         (b)      any Person other than the Company, any wholly-owned subsidiary
of the Company, or any employee benefit plan of the Company or such a subsidiary
becomes the owner of 20% or more of the Company's Common Stock and thereafter
individuals who were not directors of the Company prior to the date such Person
became a 20% owner are elected as directors pursuant to an arrangement or
understanding with, or upon the request of or nomination by, such Person and
constitute at least 1/4 of the Company's Board of Directors; provided, however,
that unless the Committee shall otherwise determine prior to the acquisition of
such 20% ownership, such acquisition of ownership shall not constitute a Change
of Control if Executive or an Executive Related Party is the Person or a member
of a group constituting the Person acquiring such ownership; or

         (c)      there occurs any solicitation or series of solicitations of
proxies by or on behalf of any Person other than the Company's Board of
Directors and thereafter individuals who were not directors of the Company prior
to the commencement of such solicitation or series of solicitations are elected
as directors pursuant to an arrangement or understanding with, or upon the
request of or nomination by, such Person and constitute at least 1/4 of the
Company's Board of Directors; or

         (d)      the Company executes an agreement of acquisition, merger or
consolidation which contemplates that (i) after the effective date provided for
in the agreement, all or substantially all of the business and/or assets of the
Company shall be owned, leased or otherwise controlled by another Person and
(ii) individuals who are directors of the Company when such agreement is
executed shall not constitute a majority of the board of directors of the
survivor or successor entity immediately after the effective date provided for
in such agreement; provided, however, that unless otherwise determined by the
Committee, no transaction shall constitute a Change of Control if, immediately
after such transaction, Executive or any Executive Related Party shall own
equity securities of any surviving corporation ("Surviving Entity") having a
fair value as a percentage of the fair value of the equity securities of such
Surviving Entity greater than 125% of the fair value of the equity securities of
the Company owned by Executive and any Executive Related Party immediately prior
to such transaction, expressed as a percentage of the fair value of all equity
securities of the Company immediately prior to such transaction (for purposes of
this paragraph ownership of equity securities shall be determined in

                                      B-1

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                                                                  CONFORMED COPY

the same manner as ownership of Common Stock); and provided further, that, for
purposes of this paragraph (d), if such agreement requires as a condition
precedent approval by the Company's shareholders of the agreement or
transaction, a Change of Control shall not be deemed to have taken place unless
and until such approval is secured (but upon any such approval, a Change of
Control shall be deemed to have occurred on the date of execution of such
agreement).

In addition, for purposes of this Exhibit B the following terms have the
meanings set forth below:

         "Common Stock" shall mean the then outstanding Common Stock of the
Company plus, for purposes of determining the stock ownership of any Person, the
number of unissued shares of Common Stock which such Person has the right to
acquire (whether such right is exercisable immediately or only after the passage
of time) upon the exercise of conversion rights, exchange rights, warrants or
options or otherwise. Notwithstanding the foregoing, the term Common Stock shall
not include shares of Preferred Stock or convertible debt or options or warrants
to acquire shares of Common Stock (including any shares of Common Stock issued
or issuable upon the conversion or exercise thereof) to the extent that the
Board of Directors of the Company shall expressly so determine in any future
transaction or transactions.

         A Person shall be deemed to be the "owner" of any Common Stock:

                  (i)      of which such Person would be the "beneficial owner,"
         as such term is defined in Rule 13d-3 promulgated by the Securities and
         Exchange Commission (the "Commission") under the Exchange Act, as in
         effect on March 1, 1989; or

                  (ii)     of which such Person would be the "beneficial owner"
         for purposes of Section 16 of the Exchange Act and the rules of the
         Commission promulgated thereunder, as in effect on March 1, 1989; or

                  (iii)    which such Person or any of its affiliates or
         associates (as such terms are defined in Rule 12b-2 promulgated by the
         Commission under the Exchange Act, as in effect on March 1, 1989), has
         the right to acquire (whether such right is exercisable immediately or
         only after the passage of time) pursuant to any agreement, arrangement
         or understanding or upon the exercise of conversion rights, exchange
         rights, warrants or options or otherwise.

         "Person" shall have the meaning used in Section 13(d) of the Exchange
Act, as in effect on March 1, 1989.

         An "Executive Related Party" shall mean any affiliate or associate of
Executive other than the Company or a majority-owned subsidiary of the Company.
The terms "affiliate" and "associate" shall have the meanings ascribed thereto
in Rule 12b-2 under the Exchange Act (the term "registrant" in the definition of
"associate" meaning, in this case, the Company).

                                      B-2

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                                                                  CONFORMED COPY

                                    EXHIBIT C

                           Change Of Control Benefits

         C.1.     Benefits Upon a Change of Control Termination.

         (a)      The Company shall pay to Executive, in a lump sum within
thirty (30) days following a Change of Control Termination, an amount equal to
(A) two times his Base Salary for one year at the rate in effect immediately
prior to the Date of Termination or the Change of Control, whichever is higher,
plus (B) the accrued and unpaid portion of his Base Salary through the Date of
Termination, subject to the following. If Executive is eligible for long-term
disability compensation benefits under the Company's long-term disability plan
or any successor Company long-term disability plan, the amount payable under (A)
shall be reduced by the annual long-term disability compensation benefit for
which Executive is eligible under such plan for the two-year period over which
the amount payable under (A) is measured. If for any period Executive receives
long-term disability compensation payments under a long-term disability plan of
the Company as well as payments under the first sentence of this paragraph (a),
and if the sum of such payments (the "combined Change of Control/disability
benefit") exceeds the payment for such period to which Executive is entitled
under the first sentence of this paragraph (a) (determined without regard to the
second sentence of this paragraph (a)), he shall promptly pay such excess in
reimbursement to the Company; provided, that in no event shall application of
this sentence result in reduction of Executive's combined Change of
Control/disability benefit below the level of long-term disability compensation
payments to which Executive is entitled under the long-term disability plan or
plans of the Company.

         (b)      Until the second anniversary of the Date of Termination, the
Company shall maintain in full force and effect for the continued benefit of
Executive and his family all life insurance and medical insurance plans and
programs in which Executive was entitled to participate immediately prior to the
Change of Control provided that Executive's continued participation is possible
under the general terms and provisions of such plans and programs. In the event
that Executive is ineligible to participate in such plans or programs, the
Company shall arrange upon comparable terms to provide Executive with benefits
substantially similar to those which he is entitled to receive under such plans
and programs. Notwithstanding the foregoing, the Company's obligations hereunder
with respect to life, medical or disability coverage or benefits shall be deemed
satisfied to the extent (but only to the extent) of any such coverage or
benefits provided by another employer.

         (c)      For a period of two years after the Date of Termination, the
Company shall make available to Executive the use of any automobile that was
made available to Executive prior to the Date of Termination, including ordinary
replacement thereof in accordance with the Company's automobile policy in effect
immediately prior to the Change of Control (or, in lieu of making such
automobile available, the Company may at its option pay to Executive the present
value of its cost of providing such automobile).

         C.2.     Gross-Up Payment. Payments under Section C.1. of this Exhibit
shall be made without regard to whether the deductibility of such payments (or
any other payments or benefits to or for the benefit of Executive) would be
limited or precluded by Section 280G of the Code

                                      C-1

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                                                                  CONFORMED COPY

("Section 280G") and without regard to whether such payments (or any other
payments or benefits) would subject Executive to the federal excise tax levied
on certain "excess parachute payments" under Section 4999 of the Code (the
"Excise Tax"). If any portion of the payments or benefits to or for the benefit
of Executive (including, but not limited to, payments and benefits under this
Agreement but determined without regard to this paragraph) constitutes an
"excess parachute payment" within the meaning of Section 280G (the aggregate of
such payments being hereinafter referred to as the "Excess Parachute Payments"),
the Company shall promptly pay to Executive an additional amount (the "gross-up
payment") that after reduction for all taxes (including but not limited to the
Excise Tax) with respect to such gross-up payment equals the Excise Tax with
respect to the Excess Parachute Payments. The determination as to whether
Executive's payments and benefits include Excess Parachute Payments and, if so,
the amount of such payments, the amount of any Excise Tax owed with respect
thereto, and the amount of any gross-up payment shall be made at the Company's
expense by PricewaterhouseCoopers LLP or by such other certified public
accounting firm as the Committee may designate prior to a Change of Control (the
"accounting firm"). Notwithstanding the foregoing, if the Internal Revenue
Service shall assert an Excise Tax liability that is higher than the Excise Tax
(if any) determined by the accounting firm, the Company shall promptly augment
the gross-up payment to address such higher Excise Tax liability.

         C.3.     Other Benefits. In addition to the amounts described in
Section C.1., Executive shall be entitled to the benefits, if any, described at
Sections 3(b) (Other Existing Options), and to payment of his Qualified-Plan
Benefits.

         C.4.     Noncompetition; No Mitigation of Damages; etc.

         (a)      Noncompetition. Upon a Change of Control, any agreement by
Executive not to engage in competition with the Company subsequent to the
termination of his employment, whether contained in an employment contract or
other agreement, shall no longer be effective.

         (b)      No Duty to Mitigate Damages. Executive's benefits under this
Exhibit C shall be considered severance pay in consideration of his past service
and his continued service from the date of this Agreement, and his entitlement
thereto shall neither be governed by any duty to mitigate his damages by seeking
further employment nor offset by any compensation which he may receive from
future employment.

         (c)      Legal Fees and Expenses. The Company shall pay all legal fees
and expenses, including but not limited to counsel fees, stenographer fees,
printing costs, etc. reasonably incurred by Executive in contesting or disputing
that the termination of his employment during a Standstill Period is for Cause
or other than for good reason (as defined in the definition of Change of Control
Termination) or obtaining any right or benefit to which Executive is entitled
under this Agreement following a Change of Control. Any amount payable under
this Agreement that is not paid when due shall accrue interest at the prime rate
as from time to time in effect at the Fleet National Bank, or its successor,
until paid in full.

         (d)      Notice of Termination. During a Standstill Period, executive's
employment may be terminated by the Company only upon thirty (30) days' written
notice to Executive.

                                      C-2<PAGE>
                                                                    EXHIBIT 10.1

                            CONFIDENTIALITY AGREEMENT

PERSONAL AND CONFIDENTIAL

                                September 8, 2003

European Metal Recycling Ltd.
Sirius House
Delta Crescent
Westbrook
Warrington WA5 7NS

Gentlemen:

         In connection with your consideration of a possible mutually agreeable
business combination transaction (a "Transaction") with Metal Management, Inc.
(the "Company"), the Company is prepared to make available to you certain
information concerning the business, financial condition, operations, assets and
liabilities of the Company to enable you to evaluate a possible Transaction. As
a condition to such information being furnished to you and your directors,
officers, employees, agents or advisors and your bankers, lenders and other
financing sources and their directors, officers, employees, agents or advisors
(including, in each case, without limitation, attorneys, accountants,
consultants, and financial advisors) (collectively, "Representatives"), you
agree that any information concerning the Company (whether prepared by the
Company, its advisors or otherwise and irrespective of the form of
communication) which is or has been furnished to you or your Representatives by
or on behalf of the Company (herein collectively referred to as the "Evaluation
Material") will be treated in accordance with the provisions of this agreement
and to take or abstain from taking certain other actions hereinafter set forth.

         The term "Evaluation Material" also shall be deemed to include that
portion of the notes, analyses, compilations, studies, interpretations or other
documents prepared by you or your Representatives which contain, reflect or are
based upon, in whole or in part, the information furnished to you or your
Representatives pursuant hereto. The term "Evaluation Material" does not include
information which (i) is or becomes generally available to the public other than
as a result of a disclosure by you or your Representatives, (ii) is within your
possession on the date hereof, provided that the source of such information is
not known by you to be bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to the Company or
any of its affiliates with respect to such information, or (iii) becomes
available to you on from a source other than the Company or any of its
Representatives, provided that such source is not known by you to be bound by a
confidentiality agreement with

<PAGE>
European Metal Recycling Ltd.
September 8, 2003
Page 2

or other contractual, legal or fiduciary obligation of confidentiality to the
Company or any of its affiliates with respect to such information.

         You hereby agree that you and your Representatives shall use the
Evaluation Material solely for the purpose of evaluating a possible Transaction
and obtaining financing thereof, that the Evaluation Material will be kept
confidential and that you and your Representatives will not disclose any of the
Evaluation Material in any manner whatsoever except as otherwise permitted by
this agreement; provided, however, that (i) you may make any disclosure of such
information to which the Company gives its written consent and (ii) any of such
information may be disclosed to your Representatives who need to know such
information for the sole purpose of assisting you in evaluating a possible
Transaction with the Company and obtaining financing thereof (it being
understood that such Representatives shall be informed by you of the
confidential nature of such information and your obligations hereunder). In any
event, you shall be responsible for any breach of this agreement by any of your
Representatives or any such person or entity. Notwithstanding anything herein to
the contrary, any party to this agreement (and any employee, Representative, or
other agent of such party) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the Transaction
contemplated by this agreement and all materials of any kind (including, without
limitation, opinions or other tax analyses) that are provided to it relating to
such tax treatment and tax structure, except that (a) the tax treatment and tax
structure shall not include the identity of any existing or future party (or any
affiliate of such party) to this agreement and (b) this provision shall not
permit disclosure to the extent that nondisclosure is necessary in order to
comply with applicable securities laws. Nothing in this agreement shall (A) in
any way limit any party's ability to consult any tax advisor (including, without
limitation, a tax advisor independent from all other entities involved in the
Transaction) regarding the tax treatment or tax structure of the Transaction or
(B) waive the attorney client privilege or other privileges, including, without
limitation, the tax advisor privilege under section 7525 of the Internal Revenue
Code.

         In addition, except for disclosures permitted by the immediately
preceding paragraph, you and the Company agree that, prior to issuing any press
release or making any other public statements regarding the fact that the
Evaluation Material has been made available to you or that discussions or
negotiations are taking place concerning a possible Transaction involving you
and the Company or any of the terms, conditions or other facts with respect
thereto, including the status thereof, the disclosing party will furnish a copy
of such proposed disclosure to the other party's counsel and provide them a
reasonable opportunity to comment on such disclosure.

         You hereby acknowledge that you are aware, and that you will advise
such Representatives who are informed as to the matters which are the subject of
this agreement, that the United States securities laws prohibit any person who
has received from an issuer material, non-public information concerning the
matters which are the subject of this agreement from purchasing or selling
securities of such issuer or from communication of such information to any

<PAGE>
European Metal Recycling Ltd.
September 8, 2003
Page 3

other person under circumstances in which it is reasonably foreseeable that such
person is likely to purchase or sell such securities.

         We hereby acknowledge that you, as beneficial holder of more than 5% of
the Company's common stock, are subject to Section 13(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act), and the rules promulgated
thereunder. Accordingly, notwithstanding anything in this agreement to the
contrary, you may make such disclosures as you have been advised by legal
counsel are required by law or legal process, including, without limitation,
pursuant to Section 13(d) of the Exchange Act and the rules promulgated
thereunder (provided you furnish a copy of any proposed disclosure to the
Company's counsel and provide them a reasonable opportunity to comment on such
disclosure).

         In the event that you or any of your Representatives are requested or
required (by oral questions, interrogatories, requests for information or
documents in legal proceedings, subpoena, civil investigative demand or other
similar process) to disclose any of the Evaluation Material, you shall provide
the Company with prompt written notice of any such request or requirement so
that the Company may seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this agreement. If, in the absence of a
protective order or other remedy or the receipt of a waiver by the Company, you
or any of your Representatives conclude, after consultation with legal counsel,
that you are nonetheless legally compelled to disclose Evaluation Material, you
or your Representative may, without liability hereunder, disclose only that
portion of the Evaluation Material which such counsel advises you is legally
required to be disclosed, provided that you exercise your commercially
reasonable efforts to preserve the confidentiality of the Evaluation Material,
including, without limitation, by reasonably cooperating with the Company's
efforts to obtain an appropriate protective order or other reliable assurance
that confidential treatment will be accorded the Evaluation Material.

         If at any time either the Company or you advises the other party that
it does not wish to continue discussions with respect to a proposed Transaction
between you and the Company, or upon request of the Company (a "Return Notice"),
you will promptly return to the Company all copies of the written Evaluation
Material then in your possession or in the possession of any of your
Representatives; provided, however, that you may promptly destroy any Evaluation
Materials prepared by you or any of your Representatives (including, without
limitation, any analyses, compilations, studies or other documents, records or
data, and any material contained on any computer tapes, computer disks or any
other form of electronic or magnetic media) in lieu of returning such materials.
You hereby agree to certify in a letter to the Company, delivered promptly
following receipt of a Return Notice, that the return required hereunder and
such destruction have been accomplished. Notwithstanding the return of the
Evaluation Material, you and your Representatives will continue to be bound by
the obligations of confidentiality and other obligations hereunder.

<PAGE>
European Metal Recycling Ltd.
September 8, 2003
Page 4

         You understand and acknowledge that neither the Company nor any of its
Representatives make any representation or warranty, express or implied, as to
the accuracy or completeness of the Evaluation Material. You agree that neither
the Company nor any of its Representatives shall have any liability to you or to
any of your Representatives relating to or resulting from the use of the
Evaluation Material or any errors or omission therefrom, except as may be
provided for in any definitive agreement between you and the Company with
respect to a Transaction.

         Until the earlier of (i) the execution by you of a definitive agreement
between you and the Company and (ii) June 15, 2004, you agree not to initiate or
maintain contact (except for those contacts made in the ordinary course of
business) with any officer, director or key employee of the Company or any of
its subsidiaries regarding its business, assets, operations, prospects, finances
or Evaluation Material, except with the express permission of the Chairman of
the Board or a duly authorized executive officer of the Company. It is
understood that the Company will arrange for appropriate contacts for due
diligence purposes. It is further understood that all (a) communications
regarding the possible Transaction, (b) requests for additional information, and
(c) discussions or questions regarding procedures will be submitted or directed
to such party as may be designated by the Company.

         You agree that until June 15, 2004, except as expressly contemplated by
this agreement, neither you nor any of the Representatives nor any of your
shareholders, directors, officers or employees, will without the prior approval
of the Board of Directors of the Company, alone or in concert with others, (a)
acquire or make any proposal to acquire any debt or equity securities of the
Company in addition to the 1,503,100 shares of the Company's common stock
currently owned by you as of the date hereof; (b) enter into or propose to enter
into any merger or business combination involving the Company or purchase or
propose to purchase a material portion of the assets of the Company; (c) make or
participate in any solicitation of proxies to vote any securities of the
Company; (d) form, join or participate in a "group" (within the meaning of
Section 13(d)(3) of the Exchange Act) with respect to any voting securities of
the Company; (e) otherwise act to seek to appoint or designate persons for
election to the Board of Directors such that your appointees or designees
constitute a majority of the directors of the Board of Directors; (f) disclose
any intention, plan or arrangement inconsistent with the foregoing; (g) initiate
or engage or participate in, any discussions or negotiations or enter into any
arrangements, understandings or agreements (whether written or oral) with any
person with respect to any of the foregoing matters or assist or seek to assist
any person in taking any action with respect to any of the foregoing matters; or
(h) take any action which might require the Company to make a public
announcement regarding the possibility of a business combination, merger or
other similar transaction. You also agree until June 15, 2004 not to request the
Company (or its directors, officers, employees, affiliates or advisors) to amend
or waive any provision of this paragraph. Notwithstanding anything in the
foregoing to the contrary, (i) in the event that the Company enters into,
publicly consents to, or becomes the target of, a transaction with a third party
(which shall not include you or any of your affiliates or any "group" (within
the meaning of Section

<PAGE>
European Metal Recycling Ltd.
September 8, 2003
Page 5

13(d)(3) of the Exchange Act) in which you or any of your affiliates is a
participant), or becomes the target of a publicly announced tender offer for the
outstanding shares of the Company's common stock or proxy contest by such a
third party, in each case which, if concluded, would constitute a Change in
Control, then the restrictions and limitations contained in the first two
sentences of this paragraph shall not apply and shall terminate and have no
further force or effect and (ii) in the event that any third party (which shall
not include you or any of your affiliates or any "group" (within the meaning of
Section 13(d)(3) of the Exchange Act) in which you or any of your affiliates is
a participant) beneficially owns more than 25% of the outstanding shares of the
Company's common stock (unless such third party is eligible to file a Schedule
13G in accordance with the requirements of Section 13(d) of the Exchange Act
with respect to such ownership (or would otherwise be permitted to file a
Schedule 13G but for such third party's inability to satisfy the requirements of
Rule 13d-1(c)(3) under the Exchange Act)), then the restrictions and limitations
contained in the first two sentences of this paragraph shall not apply and shall
terminate and have no further force or effect. For purposes of the foregoing, a
transaction shall be deemed to involve a "Change in Control" if such transaction
would result in any of the following: (A) any person (other than you or your
affiliates or the Company or its subsidiaries or affiliates or any of their
employee benefit plans or any trustee of or fiduciary with respect to any such
plan when acting in such capacity), or any group acting in concert, beneficially
owning, directly or indirectly, in excess of 50% of the Company's then
outstanding common stock and, in the event of a merger, combination,
consolidation, recapitalization, restructuring or other reorganization of the
Company pursuant to which in excess of 50% of the outstanding voting securities
of the surviving corporation or parent in such merger, combination,
consolidation, recapitalization, restructuring or other reorganization, as the
case may be, are not held by the stockholders of the Company immediately prior
to such reorganization; (B) a sale or other disposal of all or substantially all
of the assets of the Company, whether in one transaction or a series of related
transactions; or (C) any "solicitation" of "proxies" or consents to vote any of
the Company's voting securities which would result in a majority of the
directors of the Company being comprised of individuals other than (1) the
directors of the Company on the date hereof or (2) any new director whose
election or nomination for election to the Board of Directors was approved or
recommended by the Company's then current Board of Directors.

         The Company and you understand and agree that no contract or agreement
providing for any Transaction involving the Company shall be deemed to exist
between you and the Company unless and until a final definitive agreement has
been executed and delivered. The Company and you also agree that unless and
until a final definitive agreement regarding a Transaction between the Company
and you has been executed and delivered, neither the Company nor you will be
under any legal obligation of any kind whatsoever with respect to such a
Transaction by virtue of this agreement or otherwise except for the matters
specifically agreed to herein. You further acknowledge and agree that the
Company reserves the right, in its sole discretion, to reject any and all
proposals made by you or any of your Representatives with regard to a
Transaction between the Company and you, and to terminate discussions and
negotiations with you at any time.

<PAGE>
European Metal Recycling Ltd.
September 8, 2003
Page 6

         The Company and you agree that money damages would not be a sufficient
remedy for any breach of this agreement and that the Company and you shall be
entitled to equitable relief, including, without limitation, injunction and
specific performance, in the event of any breach of the provisions of this
agreement, in addition to all other remedies available at law or in equity,
including, without limitation, monetary damages, both actual and consequential.

         The agreement set forth in this letter may be modified or waived only
by a separate writing by the Company and you expressly modifying or waiving such
agreement. It is further understood and agreed that no failure or delay in
exercising any right, power or privilege hereunder will operate as a waiver
thereof, nor will any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder.

         If any term, provision, covenant or restriction of this agreement is
held by a court of competent jurisdiction to be invalid, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions of this
agreement shall remain in full force and effect.

         The term "person" as used in this agreement will be interpreted broadly
to include, without limitation, any corporation, company, group, partnership or
other entity or individual.

         This agreement is for the benefit of the Company and, to the extent
provided herein, for the benefit of you, and shall be governed by, enforced
under and construed in accordance with the laws of the State of New York,
without giving effect to any choice or conflict of law provision or rule
thereof. Each of the Company and you hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of the courts of the State of
New York and of the United States of America in each case located in the County
of New York for any litigation arising out of or relating to this agreement (and
agrees not to commence any litigation relating thereto except in such courts),
and further agrees that service of any process, summons, notice or document by
U. S. registered mail to its respective address shall be effective service of
process for any litigation brought against it in any such court. Each of the
Company and you hereby irrevocably and unconditionally waives any objection to
the laying of venue of any litigation arising out of this agreement in the
courts of the State of New York or of the United States of America in each case
located in the County of New York and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such litigation brought in any such court has been brought in an
inconvenient forum.

         This agreement shall terminate and be of no further force and effect on
the third anniversary of the date of this agreement.

<PAGE>
European Metal Recycling Ltd.
September 8, 2003
Page 7

         Please confirm your agreement with the foregoing by signing and
returning one copy of this agreement to the undersigned, whereupon this
agreement shall become a binding agreement between you and the Company.

                              Very truly yours,

                              METAL MANAGEMENT, INC.

                              By   /s/ Robert C. Larry
                                 -------------------------------------
                                    Name:  Robert C. Larry
                                    Title: Executive Vice President, Finance and
                                           Chief Financial Officer

Accepted and agreed as of
the date first written above:

EUROPEAN METAL RECYCLING LTD.

By         /s/ Colin Iles
         ---------------------------------------------------
         Name:     Colin Iles
         Title:    Managing Director

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