Employment Contract
THIS AGREEMENT made the 1st day of January, 1997, by and between Alpha Pro
Tech, Inc. ("Employer"), a corporation organized and existing under the laws of
the state of Oklahoma and Xxxxxxx Xxxxxxxx, an individual ("Employee").
Employer and Employee mutually agree as follows:
1) Employer agrees to employ Employee and Employee agrees to be employed
by Employer as Senior Vice President - Sales and Marketing.
2) During Employee's employment with Employer as Senior Vice President -
Sales and Marketing Employee will devote his full time and give his best effort
and skill exclusively to promoting the business of Employer. Employee shall
perform the duties customarily associated with that position, and shall have
such other duties and responsibilities as may be specified from time to time by
Employer. Employee agrees not to engage in any personal or business activity
which interferes with his ability to perform his duties and responsibilities to
Employer
3) Employer and Employee have agreed that Employee shall receive the
following compensation and benefits:
a) Annual salary of One Hundred Twelve Thousand Five Hundred Ninety
Two and No/100 Dollars ($112,592.00), payable semimonthly.
b) Annual cash bonus as provided in this subparagraph b of this
Paragraph 3. For the purposes of this Agreement, "Target Earnings" for any
fiscal year means the projected net income of Employer for that year set forth
in the annual budget of Employer for that year prepared by management of
Employer and approved by the President and CEO of Employer, and "Actual
Earnings" for that year means the actual net income of Employer for that
year set forth in Employer's audited financial statements for that year. Each
year during the term of this Agreement, Employee shall earn a cash bonus based
upon the Actual earnings for the year as a percentage of the Target Earnings for
the year, as follows:
Actual Earnings as %
of Target Earnings Cash Bonus
------------------ ----------
80% $30,000
90% $40,000
100% $50,000
110% $55,000
120% $60,000
130% $65,000
140% $70,000
150% $75,000
160% $80,000
170% $85,000
180% $90,000
190% $95,000
200% and above $200,000
The cash bonus for a particular year shall be paid to Employee not later than 10
days after the date the audited financial statements of Employer establishing
the Actual Earnings for that year have been released by the Employer to the
public.
c) Stock options as provided in this subparagraph c of the Paragraph
3. (i) Upon commencement of his employment under this Agreement, Employee shall
be entitled to be granted options to purchase 100,000 common shares of ALPHA PRO
TECH, LTD. at a price per share equal to the market price per share on December
31, 1996 with an expiration date of December 31, 2001, pursuant to ALPHA PRO
TECH, LTD.'S Incentive Stock Option Plan for Officers and Other Key Employees
(Employee has been furnished with a copy of the registration statement on form
S-8 relating to said plan). (ii) In addition to the stock options provided for
in the foregoing clause (i) of this subparagraph c of this Paragraph 3, for each
of the first 5 years of the term of this Agreement, Employee shall be entitled
to be granted options to purchase a number of common shares of ALPHA PRO TECH,
LTD., pursuant to ALPHA PRO TECH. LTD.'S
Incentive Stock Option Plan for Officers and Other Key Employees as in effect on
the date of grant, based on the Actual Earnings for the year as a percentage of
the Target Earnings for the year, as follows:
Actual Earnings as %
of Target Earnings Number of Options
------------------ -----------------
80% 60,000
90% 80,000
100% 100,000
Such stock options for a particular year shall be granted to Employee effective
as of the date the audited financial statements of Employer establishing the
Actual Earnings for the year have been released by Employer to the public, and
shall entitle Employee to purchase such shares at a price per share equal to the
market price per share on the date that such audited financial statements are so
released to the public with a 5 year expiration date.
d) Health and dental insurance as provided other employees of
Employer.
e) A car expense allowance of $14,000 per year, to be expensed at
the rate of $1,167.00 per month.
f) Normal and reasonable business expenses of Employee's performance
of his duties under this Agreement (other than automobile expenses which are
provided for in subparagraph e of this Paragraph 3).
g) Reasonable vacation as needed.
4. a) During Employee's employment with Employer, or at any time in the
future after employment with Employer terminates, whether voluntarily or
involuntarily, Employee agrees not to disclose to any person, firm, corporation
or other entity, except as required by law, any confidential information or
trade secrets acquired through employment with Employer unless Employee is
acting with the prior written consent of Employer.
b) Such confidential information and trade secrets are and will
remain the exclusive property of Employer. Employee agrees to return all
information and materials provided to him by employer upon termination of
employment, whether voluntary or involuntary, and Employee agrees not to retain
any copies of any such confidential information and trade secrets.
c) Employee agrees that Employer shall have the right , title and
interest in and to each and every discovery, improvement or entire invention
developed by Employee during the term of his employment by Employer which are
related to Employee's employment by Employer. Employee will cooperate fully with
Employer as requested by Employer in preparing and executing documents as may be
required to evidence or perfect such right, title and interest, and obtain any
legal protection thereof Employer may desire.
5. During Employee's employment with Employer, Employee agrees not to
engage, directly or indirectly, individually or as a partner, director, officer,
consultant, advisor, employee or agent, in any business competing for the
customers or accounts of Employer, or solicit business from any customer of
Employer on behalf of any company, firm, business, or other entity engaged in a
line similar to or competitive with that of Employer.
6. It is agreed that due to the irreparable injury and damage to Employer
that would result from Employee's breach or anticipated breach of any of the
terms and covenants of Paragraph 4 or 5 of this Agreement, Employer will be
entitled to injunctive relief against Employee for any such breach.
7. The term of this Agreement shall be for (3) years commencing January 1,
1997, provided , however , that if Actual Earnings for at least one (1) of such
initial three (3) years is not less than 100% of the Target Earnings for that
year, then the term of this Agreement shall be automatically extended for an
additional two (2) years commencing January 1, 1999. During the term of this
Agreement, Employer may terminate Employee for reasons of gross misconduct,
dishonesty, inability of Employee by reason of sickness or injury to perform the
normal duties of his employment under this Agreement for a period of two (2)
months in any twelve (12) month period, or conduct which breaches this
Agreement.
8. a) For a period of one (1) year from the termination of employment with
Employer, Employee will not directly or indirectly solicit, service or manage
competitive business from or of any existing customers of Employer.
b. For purposes of this Agreement, a "existing customer" shall mean
any person, corporation or entity that was an active customer of Employer at the
time of termination of Employee's employment, or at any time during the twelve
(12) months prior to such termination.
c. The geographical limit of this Paragraph shall be the areas or
territories in which the Employer does business at the time of termination, or
the greatest geographical extent deemed reasonable and enforceable by any court
of competent jurisdiction called upon in appropriate proceedings to enforce this
Agreement.
d. It is further agreed that due to the irreparable injury and
damage to Employer that would result from Employee's breach or anticipated
breach of any of the terms and covenants of this Paragraphs 8 of this Agreement,
Employer will be entitled to injunctive relief against Employee for any such
breach or anticipated breach.
9. This Agreement shall expire automatically at the end of the term
provided in Paragraph 7 of this Agreement, unless renewed by Employer and
Employee, in writing, for a specified additional term. If this Agreement so
expires, the employment relationship between Employer and Employee shall convert
to employment-at-will, and either Employer or Employee may terminate said
employment at any time, with or without notice. Should said employment
relationship convert to at-will-employment, the remaining provisions of this
Agreement shall continue in full force and effect except for the first sentence
of Paragraph 7, and subject to the following; (i) Employee shall not be entitled
to receive any stock options with respect to any such period of at-will
employment, (ii) Employee's salary and car allowance during such period of
at-will employment shall be at the annual rates provided for in subparagraphs a
and e of Paragraph 2 of this Agreement but shall be payable only for the period
of such at-will employment, (iii) should such at-will employment terminate
during a calendar year, Employee shall be entitled to receive that portion of
the cash bonus for such year as the number of days
of his employment during the year bears to the total number of days in the year,
and (iv) Employee shall be entitled to reimbursement only of business expenses
actually incurred during such period of at-will employment, and shall be
entitled to health and dental insurance benefits and vacation only during the
period of at-will employment.
10. a. Employer and Employee agree that any and all disputes,
disagreements, controversies or claims arising out of or pertaining to
Employee's employment with Employer or arising out of or relating to this
Agreement, with the exception of disputes, disagreements, controversies, or
claims pertaining to Paragraph 4 or 5 or 8, of this Agreement if not resolved
informally, will be submitted to final and binding arbitration upon the written
request of either Employer or Employee.
b. The written request for arbitration must state the nature of the
dispute, disagreement, controversy, or claim of the party requesting arbitration
and state in detail the facts underlying the dispute, disagreement, controversy,
or claim.
c. The arbitrator will be selected and the arbitration proceedings
will be conducted in accordance with the Rules and Regulations of the American
Arbitration Association.
d. Employer and Employee will share equally all costs associated
with the arbitration procedure, including, but not limited to, any fees or
charges of the American Arbitration Association, and the arbitrator's fee,
regardless of the outcome of the arbitrator's decision.
11. This Agreement sets froth the entire Agreement between Employer and
Employee concerning the terms and conditions of Employee's employment with
Employer. All prior terms and conditions of employment, whether written or oral,
are superseded by this Agreement. This Agreement shall not be amended except by
written instrument executed by Employer and Employee.
12. Should any court of competent jurisdiction determine that any
provision of this Agreement is void or unenforceable, in whole or in part, such
determination shall not affect any other provision of this Agreement, and all
other provisions shall remain in force and effect.
13. Any waiver by either party of a breach of any provision of this
Agreement shall not operate or be construed to be a waiver of any other breach
of such provision or any breach of any other provision of this Agreement. The
failure of either party to insist upon strict adherence to any terms of this
Agreement on one or more occasions shall not be considered a waiver or deprive
that party of the right thereafter to insist upon strict adherence to that term
or any other terms of this Agreement. No waiver by Employer shall be valid
unless in writing and signed by an authorized officer of Employer.
14. This Agreement shall be governed by and construed in accordance with
the laws of the State of Utah.
IN WITNESS WHEREOF, Alpha Pro Tech, Inc. has caused this instrument to be
executed and its corporate seal affixed by its duly authorized officers, and
Employee has set his hand and seal hereon as of the date first above written.
ALPHA PRO TECH, INC.
Date January 3, 1997 By /s/ Xxxxxxx Xxxxxxx
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/s/ [ILLEGIBLE] /s/ Xxxxxxx Xxxxxxxx
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Witness Employee
