Washington, D.C. 20530
EXHIBIT
10.2
 |
U.S.
Department of Justice
Criminal
Division
|
|
Xxxxxxxxxx,
X.X. 00000
|
|
October
10, 0000
Xxxxxxx
Xxxxxx, Xxx.
Xxxxxxxxxx,
Xxxxxxxxxx & Xxxx LLP
0000
X
Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Re:
United
States v. SSI INTERNATIONAL FAR EAST. LTD.
Plea
Agreement, CR 06-398
Dear
Xx.
Xxxxxx:
1.
Parties/Scope:
This
plea agreement is between the United States Department of Justice, Criminal
Division, Fraud Section (“the
Department”)
and
defendant, SSI INTERNATIONAL FAR EAST, LTD. (“SSI
KOREA”),
a
wholly owned subsidiary of Schnitzer Steel Industries, Inc. (“Schnitzer
Steel”),
and
thus does not bind any other federal, state, or local prosecuting,
administrative, or regulatory authority. This agreement does not apply to any
other charges other than those specifically mentioned herein.
2.
Charges:
Defendant SSI KOREA, an organization under 18 U.S.C. _
18, by
its authorized agent, Xxxxxxx X. Xxxxxx, Chairman, SSI International Far East,
Ltd., agrees to waive indictment and plead guilty to an information charging
one
count each of Conspiracy (18 U.S.C. _
371),
violating the Foreign Corrupt Practices Act (“FCPA”)
(15
U.S.C. § 78dd-3),
Wire Fraud (18 U.S.C. _
1343),
and aiding and abetting the making of false entries in Schnitzer’s
books
and records (15 U.S.C. §
78m(b)(2) & (5) and 18 U.S.C. _
2).
3.
Factual
Basis:
Defendant
SSI KOREA is pleading guilty because it is guilty of the charges contained
in
Counts One through Four of
the
Information. Defendant SSI KOREA agrees and stipulates that the factual
allegations set forth in the Information are true and correct and accurately
reflect its criminal conduct. The parties further stipulate and agree to the
Statement of Facts attached hereto and incorporated herein as
Exhibit 1.
4.
Penalties:
a.
The statutory maximum sentence that the Court can impose for a violation of
Xxxxx 00, Xxxxxx Xxxxxx Code, Section 371 is a fine of $500,000 or twice the
gross gain or gross loss resulting from the offense, whichever is greatest,
18
U.S.C. §§ 3571(c)(3) and (d); five years’ probation, 18 U.S.C § 3561(c)(1); and
a mandatory special assessment of $400, 18 U.S.C.
§ 3013(a)(2)(B).
b.
The statutory maximum sentence that the Court can impose for a violation of
Xxxxx 00, Xxxxxx Xxxxxx Code, Section 78dd-3 is a fine of $25,000,000 or twice
the gross gain or gross loss resulting from the offense, whichever is greatest,
15 U.S.C. §§ 78ff(a), 18 U.S.C. § 3571(d); five years’ probation, 18 U.S.C §
3561(c)(1); and a mandatory special assessment of $400, 18 U.S.C.
§ 3013(a)(2)(B).
c.
The statutory maximum sentence that the Court can impose for a violation of
Xxxxx 00, Xxxxxx Xxxxxx Code, Section 1343 is a fine of $500,000 or twice the
gross gain or gross loss resulting from the offense, whichever is greatest,
18
U.S.C. §§ 3571(c)(3) and (d); five years’ probation, 18 U.S.C § 3561(c)(1); and
a mandatory special assessment of $400, 18 U.S.C.
§ 3013(a)(2)(B).
d.
The
statutory maximum sentence that the Court can impose for a violation of Xxxxx
00, Xxxxxx Xxxxxx Code, Section 78m(b)(2)&(5) is a fine of $25,000,000 or
twice the gross gain or gross loss resulting from the offense, whichever is
greatest, 15 U.S.C. §§ 78ff(a), 18 U.S.C. § 3571(d); five years’ probation, 18
U.S.C § 3561(c)(1); and a mandatory special assessment of $400, 18 U.S.C.
§ 3013(a)(2)(B).
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5.
No
Prosecution:
In
exchange for SSI KOREA’s guilty plea and the complete fulfillment of all its
obligations under this Agreement, the Department agrees not to file additional
criminal charges against SSI KOREA for any corrupt payments or accounting
thereof disclosed to the Department as of the date of this Agreement, but
specifically excluding any such conduct not disclosed to the Department as
of
that date or any conduct occurring after that date. This Agreement will not
close or preclude the investigation or prosecution of any natural persons,
including any officers, directors, employees, stockholders, agents or
consultants of SSI KOREA, its direct or indirect affiliates, subsidiaries,
or
parent corporations who may have been involved in any of the matters set forth
in the Information or in any other matters.
6.
Sentencing
Factors:
The parties agree that pursuant to United
States x. Xxxxxx,
000
X.X. 000 (2005), the Court must determine an advisory sentencing guideline
range
pursuant to the United States Sentencing Guidelines (“USSG”).
The
Court will then determine a reasonable sentence within the statutory range
after
considering the advisory sentencing guideline range and the factors listed
in 18
U.S.C. §
3553(a).
The parties’
agreement herein to any guideline sentencing factors constitutes proof of those
factors sufficient to satisfy the applicable burden of proof.
7.
Stipulated
Fine and Sentence:
Assuming SSI KOREA accepts responsibility as explained above, the parties will
recommend the imposition of a fine in the amount of $7,500,000 payable to the
Clerk of the Court for the United States District Court for the District of
Oregon. The parties further agree that this amount
3
shall
be
paid as a lump sum within five (5) business days after the imposition of
sentencing in this matter. Defendant SSI KOREA further agrees to pay the Clerk
of the Court for the United States District Court for the District of Oregon
within (5) business days of the time of sentencing the mandatory special
assessment.
8.
Basis
for Stipulated Fine:
The parties agree that an appropriate disposition of the case is a fine of
$7,500,000 for defendant SSI KOREA based upon the following
factors:
a. By entering and fulfilling the obligations under this Agreement, defendant
SSI KOREA demonstrates recognition and affirmative acceptance of responsibility
for its criminal conduct;
b. The
plea
underlying this Agreement is a result of the voluntary disclosure of the
relevant conduct at the direction of the audit committee of Schnitzer Steel,
the
parent of SSI KOREA, to the Department beginning in November 2004 and the
disclosure of the extensive investigation its attorneys subsequently conducted
into the Asian operations of Schnitzer Steel and SSI KOREA;
c.
At the time of the initial disclosure, the conduct was unknown to the
Department; and
d. By entering into a deferred prosecution agreement with the Department,
Schnitzer Steel has, among other things, agreed to implement a compliance and
ethics program designed to detect and prevent violations of the FCPA, U.S.
commercial bribery laws and all applicable foreign bribery laws throughout
its
operations, including those of SSI KOREA and all of Schnitzer Steel’s
subsidiaries and affiliates, and to appoint an independent compliance consultant
to monitor the company’s compliance program.
9.
Waiver
of Presentence Report:
The parties further agree, with the permission of the Court, to waive the
requirement for a presentence report pursuant to Federal Rule of Criminal
Procedure
4
32(c)(1)(A),
based on a finding by the Court that the record contains information sufficient
to enable the Court to meaningfully exercise its sentencing power. However,
the
parties agree that in the event the Court orders the preparation of a
presentence report prior to sentencing, such order will not affect the agreement
set forth herein.
10.
Entry
of Guilty Plea and Sentencing:
The parties further agree to ask the Court’s
permission to combine the entry of the plea and sentencing into one hearing.
However, the parties agree that in the event the Court orders that the entry
of
the guilty plea and sentencing hearing occur at separate hearings, such an
order
will not affect the agreement set forth herein.
11.
Waiver
of Appeal/Post-Conviction Relief:
SSI KOREA knowingly, intelligently, and voluntarily waives defendant’s
right
to appeal the conviction in this case. SSI KOREA similarly knowingly,
intelligently, and voluntarily waives the right to appeal the sentence imposed
by the court, provided the sentence does not exceed the sentence agreed by
the
parties herein. In addition, SSI KOREA knowingly, intelligently, and voluntarily
waives the right to bring a collateral challenge pursuant to 28 U.S.C.
§
2255,
against either the conviction, or the sentence imposed in this case, except
for
a claim of ineffective assistance of counsel. SSI KOREA waives all defenses
based on the statute of limitations and venue with respect to any prosecution
that is not time-barred on the date that this agreement is signed in the event
that (a) the conviction is later vacated for any reason, (b) SSI KOREA violates
this agreement, or (c) the plea is later withdrawn. The government is free
to
take any position on appeal or any other post judgment matter.
5
12.
Court
Not Bound:
The Court is not bound by the recommendations of the parties or of those made
in
any presentence report. Because this Agreement is made under Rule 11(c)(1)(B)
of
the Federal Rules of Criminal Procedure, SSI KOREA may not withdraw any guilty
plea or rescind this plea agreement if the Court does not follow the agreements
or recommendations herein.
13.
Full
Disclosure/Reservation of Rights:
In the event the Court directs the preparation of a presentence report, the
Department will fully inform the preparer of the presentence report and the
Court of the facts and law related to SSI KOREA’s
case.
Except as set forth in this Agreement, the parties reserve all other rights
to
make sentencing recommendations and to respond to motions and arguments by
the
opposition.
14.
Breach
of Plea Agreement:
If SSI KOREA breaches the terms of this Agreement, or commits any new criminal
offenses between signing this Agreement and sentencing, the Department is
relieved of its obligations under this Agreement, but SSI KOREA may not withdraw
any guilty plea.
13.
Total
Agreement:
This letter states the full extent of the agreement between the parties. There
are no other promises or agreements, express or implied. If SSI KOREA accepts
this offer, please sign and attach the original of this letter to the Petition
to Enter Plea.
Very
truly yours,
6
FOR
THE
DEPARTMENT OF JUSTICE:
/s/
Xxxxxx X.
Xxxxxxx
Xxxxxx
X.
Xxxxxxx
Acting
Chief, Fraud Section
By:
/s/
Xxxxxxxx
XxXxxxxx
XXXX
X.
XXXXXXXXXX
Deputy
Chief, Fraud Section
XXXXXXX
X. XXXXXXXXXXX
Assistant
Chief, Fraud Section
XXXXXXXX
XXXXXXXX
Trial
Attorney, Fraud Section
Fraud
Section, Criminal Division
United
States Department of Justice
10th&
Xxxxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx,
X.X. 00000
(000)
000-0000
FOR
SCHNITZER:
/s/
Xxxxxxx X.
Xxxxxx
Xxxxxxx
X. Xxxxxx
Chairman
SSI
International Far East, Ltd.
0000
XX
Xxxx Xxxxxx
Xxxxxxxx,
Xxxxxx 00000
7
