Piece of metal in cylinder; destroyed spark plug

Today I was driving along and then a ticking noise started. It sounded like a large zip tie was hitting the belt/pulley area of the engine. It happened real quick and went away. Thought I ran over a stick or something.

It quickly got worse and more consistent.

I stopped at the next gas station, looked under car, no stick. Opened hood and started engine. Sounded like I dropped or severely bent a valve, but it was still intermittent.

Pulled spark plug closest to pulleys. It was heavily gouged and the gap was non existant, the metal arm of the spark plug was touching the electrode.

Did compression test and got 180 in all cylinder's except 195 in the farthest to the right.

Got a magnet on a string and pulled out a squared metal pin. It may have started as a screw but there's not a head on it and it feels squared instead of round. See attached pics.

Any idea what this could've come from? VICS? VTCS?

Thanks in advance

Pics:
Spark plug: http://imgur.com/qclXnHR
Metal piece: http://imgur.com/RTMC4qX

looks like too much material to be a screw for the vics/vtcs. Those screws are pretty small.
Might be a good idea to check the cylinder with a borescope. I have no clue what the source could be though