EMPLOYMENT AGREEMENT

  A.           Base Salary, Bonus and Commissions.  Subject to the terms and conditions set forth herein, the Company will pay the Manager a base salary at the annual rate of $285,000  minus withholdings as required by law and other deductions authorized by the Manager, which amount shall be paid in equal installments at the Company’s regular payroll intervals.  Any increase to the Manager’s base salary will be determined by the Compensation Committee of the Board of Directors of Omega Protein Corporation, the sole stockholder of the Company (“Omega Protein”).

  B.           Benefits.  The Manager shall be eligible to participate in all vacation, group health, dental, life, 401(k), pension and other insurance and/or benefit plans that the Company may offer to its employees from time to time and on the same terms as offered to other employees as in effect on and after the Effective Date. The Manager acknowledges that the Company has the right to terminate, or make modifications to, any existing Company benefit plans at any time.

  C.           Business Expenses.  The Company shall reimburse the Manager for all reasonable expenses incurred by him for travel, lodging and food in performing his duties and responsibilities under this Agreement, provided that the Manager submits documentation of such expenses in a form reasonably acceptable to the Company.  In addition, Manager will receive an annual car allowance for $7,000.00 to be used for the lease or purchase of a 4-door car and maintenance and insurance on such car.  Manager shall also be entitled to use of a Company gas credit card (or reimbursed through expense reports) and cellular phone service at the Company’s expense, which shall be used for Company business.

  D.           Vacation.   The Manager shall accrue twenty (20) days of paid vacation per year, which shall be taken at times that do not unreasonably interfere with the performance of Manager’s duties hereunder.   The Manager shall not accrue more than forty (40) days of vacation.  Once the accrual cap has been reached, vacation time will no longer accrue until some of the previously accrued vacation is taken.

  B.           Disability.  The Company shall have the right to terminate in the event that the Manager shall be prevented, by illness, accident, disability or any other physical or mental condition (to be determined by means of a written opinion of a competent medical doctor chosen by mutual agreement of the Company and the Manager or his personal representative(s)) from substantially performing his duties and responsibilities hereunder with reasonable accommodation for one or more periods totaling one hundred twenty (120) days in any twelve (12) month period.  In the event of a termination pursuant to this Section, the Company shall pay the Manager, as severance pay, his base salary through the end of the second month following the termination.  After that time, the Manager’s right (if any) to receive income continuation shall be determined solely in accordance with the terms and conditions of the Company’s disability plans and/or any other compensation and benefit plans then in effect.

  C.           Death.  In the event of a termination by reason of the Manager’s death, the Company shall pay to the Manager’s estate, designated beneficiary or legal representative his base salary through the end of the month in which his death occurs, together with such other payments or benefits to which the Manager may be entitled under the Company’s benefit plans then in effect.

  D.           Termination by the Company other than for Disability, Death or Cause.  The Company shall have the right to terminate, other than for Cause, disability or death, upon thirty (30) days prior written notice to the Manager (or may terminate immediately and pay the Manager’s base salary for such 30 days).  In the event of a termination pursuant to this Section, the Company shall pay to the Manager (i) his base salary through the date of termination, (ii) such other benefits and payments to which the Manager may be entitled by law, and (iii) provided that the Manager executes a general release of claims against the Company and its officers, directors, agents and employees as to any employment related claims,  in a form acceptable to the Company, (a) severance pay equal to the Manager’s base salary (excluding bonuses and commissions) for a period of eight (8) months following termination plus (b) benefits on the same or similar terms to which Manager was entitled on the date of termination for a period of eight (8) months following termination.

 

  E.           Termination by the Manager.  The Manager shall have the right to terminate for any reason by providing thirty (30) days’ prior written notice to the Company; provided that the Company may elect to relieve Manager of his duties during such thirty-day period.  In the event of a termination pursuant to this Section, the Company shall only be obligated to pay the Manager his base salary for such thirty (30) day notice period and such other benefits and payments to which the Manager may be entitled by law.  Manager will also be paid for all accrued and unused vacation as of the termination date.

  A.           Confidential Information. For the purpose of assisting the Manager in performance of his job requirements and responsibilities with the Company, the Company, Omega Protein or any of their affiliates shall provide the Manager, during the Term of this Agreement, with some or all of the following, any and all of which constitute confidential information of the Company, Omega Protein or any of their affiliates (collectively the “Confidential Information”): (a) any and all trade secrets concerning the business and affairs of the Company, Omega Protein or any of their affiliates, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current and planned research and development, current and planned manufacturing and distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, proprietary computer software and programs (including object code and source code), proprietary database technologies, systems, structures, architectures, processes, improvements, devices, know-how, discoveries, concepts, methods and information of the Company, Omega Protein or any of their affiliates and any other information, however documented, of the Company and its affiliates that is a trade secret under applicable law (b) any and all information concerning the business and affairs of the Company,  Omega Protein or any of their affiliates (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel, contractors, agents, suppliers personnel training and techniques and materials, and purchasing methods and techniques) however documented; and (c) any and all notes, analysis, compilations, studies, summaries and other material prepared by or for the Company, Omega Protein or any of their affiliates containing or based, in whole or in part, upon any information included in the foregoing. The Manager acknowledges that he will occupy a position of trust and confidence with the Company and Omega Protein during the Term of this Agreement and that he will during the Term of this Agreement have access to and become familiar with such Confidential Information.   Notwithstanding the foregoing, “Confidential Information” shall not include any information that (A) is in the public domain (other than from disclosure by Manager in violation of this Agreement), (B) was rightfully in the possession of Manager, as shown by Manager’s records, prior to the date of this Agreement and which is not directly applicable to the business of the Company or any of its properties or assets, (C) is lawfully acquired by Manager after the employment term from any third party not bound by an obligation of confidence to the disclosing party; or (D) is independently developed by or for the Manager after the employment term without using the Confidential Information of the Company.

  C.           Nonsolicitation of Employees.  During the Manager’s employment with the Company or its affiliates and for twelve (12) months thereafter, the Manager shall not, directly or indirectly cause, solicit, induce or encourage any employees of the Company, Omega Protein or any of their affiliates to leave such employment.

  D.           Nonsolicitation of Customers.  During the Manager’s employment with the Company or its affiliates and for twelve (12) months thereafter, the Manager shall not, directly or indirectly use trade secret information to cause, induce or encourage any actual or prospective client, customer, supplier, or licensor of the Business (including any existing or former customer of the Company, Omega Protein or any of their affiliates or any other person who has a material business relationship with the Business, to terminate or modify any such actual or prospective relationship or to otherwise unfairly compete with the Company, Omega Protein or any of their affiliates.

  E.           Enforcement. The Manager agrees that this Section 6 is reasonable with respect to its duration, geographical area and scope. In the event of a breach by the Manager of any covenant set forth in this Section 6, the term of such covenant with respect to the Manager will be extended by the period of the duration of such breach.  The provisions of this Section 6 and Sections 8-15 shall survive the expiration or termination of this Agreement.

  A.           Arbitrable Claims.  Any controversy or claim arising out of or relating to Manager’s employment by the Company, or the termination of his employment or a breach of this Agreement, (including, without limitation, any claim that any provision of this Agreement or any obligation of Manager is illegal or otherwise unenforceable or voidable under law, ordinance or ruling or that Manager’s employment by the Company was illegally terminated) shall be settled by arbitration before a neutral arbitrator through arbitration administered in accordance with the United States Arbitration Act (9 USC, § 1 et seq.) and the rules of the American Arbitration Association under its National Rules for the Resolution of Employment Disputes or similar rules.  Any demand for arbitration must be in writing and made within the applicable statue of limitations period. The parties will be entitled to conduct reasonable discovery, the arbitration will be conducted before a single neutral arbitrator who will be a judge or an attorney with expertise and experience in employment law and/or in arbitrating employment law claims ("the Arbitrator").  The arbitration will take place in Orange County, California.  The Arbitrator will apply the substantive law (and the law of remedies, if applicable) of the state of California to the Claim(s) asserted.  The parties may select a mutually agreeable arbitrator from any of the recognized arbitration associations (including without limitation JAMS, AAA or ADR).  If the parties cannot agree on an arbitrator within 30 days of the demand for arbitration, the parties will request from one of the organizations a list of five (5) names drawn from its panel of employment arbitrators and each party will strike arbitrators pursuant to the strike procedures of that organization.  The Company and Manager each consent and submit to the personal jurisdiction and venue of the trial courts of Orange County California, for purposes of enforcing this provision.

  B.           Arbitrator’s Award.  All awards of the arbitration shall be in writing and shall contain the findings and conclusions on which the award was based, including any award of costs or attorneys’ fees.  All awards of the arbitration shall be binding and non-appealable except as otherwise provided in the United States Arbitration Act; provided, however, that the arbitrator shall not be authorized to issue any ruling or award that is contrary to the laws of the State of California or the United States, notwithstanding any provisions or lack of provisions in the United States Arbitration Act, the provisions of the California Code, or any other applicable federal or state law.  In the event that either party appeals the award or decision of the arbitrator on the grounds that the arbitrator’s award or decision is contrary to the laws of the State of California or the United States, then the parties acknowledge and agree that they shall not seek to have the dispute re-tried in the courts, but rather will submit the record of the arbitration proceedings to the court for a decision solely on whether the arbitrator’s judgment or award is contrary to the laws of the State of California or the United States, and to either affirm or vacate the award or decision on that basis.  If the award or decision is vacated, then the parties shall re-submit the dispute to arbitration.  Subject to the foregoing, judgment upon the award of the arbitrator may be entered in any court having jurisdiction.

  C.           Remedies.  The arbitration shall take place at a time noticed by the Arbitrator regardless of whether one of the parties fails or refuses to participate.  The Arbitrator shall have authority to award any remedy or relief that a court of competent jurisdiction could order or grant, including, without limitation, specific performance of any obligation created under this Agreement, the issuance of an injunction or other provisional relief, or the imposition of sanctions for abuse or frustration of the arbitration process.  The arbitrator has no authority to order any remedy in excess of that which a court or agency of competent jurisdiction would be authorized to order.  The parties shall be entitled to engage in reasonable discovery, including a request for the production of relevant documents.  Depositions may be ordered by the arbitrator upon a showing of need.

 

  D.           Injunctive Relief and Cost of Arbitration.  The foregoing provisions shall not preclude Manager or the Company from bringing an action in any court of competent jurisdiction for injunctive or other provisional relief as Manager or the Company may determine is necessary or appropriate.  By way of non-exclusive examples, claims subject to arbitration under this Agreement shall include claims under federal, state and local statutory or common law, such as the Fair Employment and Housing Act, Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, as amended, including the amendments of the Civil Rights Act of 1991, the Americans with Disabilities Act, and contract and tort laws.  The costs of the Arbitrator shall be paid by the Company, including the costs of the selected arbitration association and the arbitrator.  The Company and Manager shall each pay for its own other costs that are not unique to arbitration (i.e., costs that each party might incur if the claim(s) were litigated in a court or agency of competent jurisdiction), including, for example, costs to subpoena witnesses and/or documents, costs to take depositions and purchase deposition transcripts, costs to copy, facsimile or messenger documents, et cetera.  Any dispute whether a cost is unique to arbitration shall be exclusively resolved by the Arbitrator.  The arbitration proceedings will be confidential.