Company: APT
Filing Date: 2025-04-30
Form Type: DEF 14A
Source: 0001437749-25-013635
Chunk: 25

Company: ALPHA PRO TECH LTD
Filing Date: 2025-04-30
Form: DEF 14A
Chunk 25
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 basis, taking into account the need to incentivize management. Stock options become exercisable over time and, thus, require a longer-term commitment by the Named Executive Officers to realize the appreciation potential of the options.

In April 2020, the Board adopted the Alpha Pro Tech, Ltd. 2020 Omnibus Incentive Plan (as amended, the “2020 Incentive Plan”), which was subsequently approved by the Company’s stockholders at the 2020 Annual Meeting of Shareholders. The 2020 Incentive Plan succeeded the Option Plan and is designed to improve the Company’s compensation scheme by better aligning the financial interests of the Named Executive Officers with those of the Company’s shareholders. The 2020 Incentive Plan is administered by the Compensation Committee. Pursuant to the 2020 Incentive Plan, the types of awards that may be granted include incentive stock options, nonqualified stock options, stock appreciation rights, restricted awards, performance share awards, cash awards, and other equity-based awards. The terms of the awards, including such details as the dates after which options become exercisable, any restrictions placed on restricted awards, performance metrics and thresholds for performance-based awards and vesting conditions for various types of awards, are established by the Compensation Committee within the parameters of the 2020 Incentive Plan.

Contractual Incentive Awards

Contractual incentive awards have historically been provided to our President and Chief Executive Officer, pursuant to which such individual or individuals, as applicable, were entitled to a cash incentive award equal to 5% of the consolidated annual pre-tax profits of the Company, excluding bonus expenses. Mr. Hoffman is entitled to such an award pursuant to his employment agreement, as further described below.

The Company believes that each key element complements the others, and that together the key elements achieve the Company’s principal compensation objectives. Our compensation program has been successful in retaining executive talent, as evidenced by the longstanding employment of our current Named Executive Officers with the Company.

Perquisites

The Company limits the perquisites provided to our Named Executive Officers. Additionally, we do not maintain any pension or defined benefit plans specifically for the benefit of our Named Executive Officers. Accordingly, our executives are entitled to few benefits that are not otherwise available to all of our employees. Perquisites include car insurance and personal use of a corporate condominium.

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Employment Agreement

The Company entered into an employment agreement with Mr. Hoffman, related to his role as Chief Executive Officer of the Company