EXHIBIT 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement dated and effective as of February 3, 2009 (this
“Agreement”) is entered into by and between Omega Protein Corporation, a Nevada
corporation with headquarters in Houston, Texas (the “Company” or “Omega”), and
Joseph E. Kadi (the “Employee”).

WHEREAS, the Company has promoted the Employee to Senior Vice President –
Operations of the Company; and

WHEREAS, the Company desires to provide the Employee with certain assurances
regarding his employment in the event of termination of Employee’s employment;

THEREFORE, in consideration of the foregoing and the mutual provisions contained
herein, and for other good and valuable consideration, the parties hereto agree
with each other as follows:

1. Employment. On the terms and subject to the conditions set forth herein, the
Company hereby employs the Employee and the Employee hereby accepts employment
with the Company as Senior Vice President – Operations. The Employee will
perform the duties, functions and services as the Chief Executive Officer of the
Company or his designee may from time to time request.

2. Compensation and Other Employee Benefits. As compensation for the Employee’s
services hereunder, the Company will:

 

  (a) pay to the Employee an annual base salary (the “Base Salary”), subject to
such withholdings or other deductions as may be required by applicable laws or
regulations, of Two Hundred Thousand and No/100 Dollars ($200,000.00) in
accordance with the then current payroll policies of the Company, which Base
Salary will be subject to increase (but not decrease) at the discretion of the
Company; and

 

  (b) afford the Employee the right to participate in Company employee health
and welfare benefit plans available to all employees generally, in a manner
consistent with the participation of such other employees, as well as the
Company’s Executive Medical Plan as long as such plan is in effect for senior
executives; and

 

  (c) subject to the requirements of the business expense reimbursement policies
and procedures of the Company as in effect from time to time, including without
limitation, the requirement of written documentation of expenses, reimburse the
Employee for the reasonable out-of-pocket expenses he incurs in the course of
performing his duties hereunder; such expenses shall be paid as soon as
administratively feasible but no later than March 15 after the end of the
calendar year in which such expenses were incurred; and

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  (d) provide employee with four weeks paid vacation per year in accordance with
then-current Company policy.

 

  (e) Employee will be entitled to cash payments for the following benefits, to
be paid in all events no later than March 15, 2010, under the Company’s
Relocation policy described below (subject to written documentation):

 

  •  

House hunting trip up to 7 days

 

  •  

Moving of household goods

 

  •  

Temporary housing for 3 months

 

  •  

Furniture storage for up to 3 months

 

  •  

Utility hookups

 

  •  

Packing and unpacking of household goods

 

  •  

Transportation to new location for personal auto (2 autos maximum) at regular
Company mileage allowance

 

  •  

Company will provide reimbursement of 50% of any loss on the sale of Employee’s
residence in Illinois up to a maximum reimbursement of $25,000. Company will
reimburse Employee for 50% of the difference, up to a $25,000 cap, between the
amount of the independently appraised value of Employee’s residence in Illinois
and the final sale price as stated in the original sales documents under the
terms and conditions above. The amount of the reimbursement will be determined
using the following documents:

 

  •  

Independent third party appraisal documents

 

  •  

Sale documents upon the sale of Employee’s home in Illinois

 

  •  

Company will pay realtors fee at the rate of 6%, not to exceed $30,000, on the
sale of Employee’s home in Illinois. Company will reimburse closing cost (loan
origination fee @1%) not to exceed $6,000. Employee’s fully executed HUD forms
and mortgage documents from sale and repurchase of the houses will be the basis
for determining these reimbursements.

 

  (f) Employee will be entitled to the use of a Company vehicle in accordance
with Company policy.

 

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3. Termination of Employment.

 

  (a) For Due Cause. If the Company has Due Cause (as defined below) to
terminate the Employee’s employment, the Company will be entitled to terminate
the Employee’s Employment at any time by delivering written notice of that
termination to the Employee, in which event (i) that termination will be
effective immediately on the delivery of that notice, (ii) the Company will pay
to the Employee his Base Salary accrued and unpaid to the date of that
termination, and (iii) all the rights and benefits the Employee may have under
any health and welfare benefit plans will be determined in accordance with the
terms and conditions of those plans.

“Due Cause” means (i) the material failure by the Employee to fulfill the
Employee’s duties or misconduct or gross neglect in the performance of such
duties, (ii) the Employee’s commission of fraud, misappropriation, embezzlement
or act of moral turpitude, or (iii) the Employee’s commission of any felony for
which the Employee is convicted. For the purposes of this paragraph, the term
“Company” includes subsidiaries of the Company.

 

  (b) Death or Disability. If the Employee dies or suffers a disability, (i) the
Employee’s employment will terminate on the date of his death or Disability,
(ii) the Company will pay to the Employee or his estate the Employee’s Base
Salary accrued and unpaid to the date on which he died or became disabled, and
(iii) all the rights and benefits the Employee (or his estate) may have under
any Company health and welfare benefit plans will be determined in accordance
with the terms and conditions of those plans.

 

  (c) Voluntary Termination by Employee. The Employee may voluntarily terminate
his Employment at any time by providing at least fourteen (14) days’ prior
written notice to the Company, in which event, (i) the Company will pay to the
Employee his Base Salary accrued and unpaid to the date the employment
terminates, and (ii) all the rights and benefits the Employee may have under any
Company health and welfare benefit plans will be determined in accordance with
the terms and conditions of those plans.

 

  (d)

Involuntary Termination by Company. The Company will be entitled to terminate
the Employee’s employment at any time for any reason. If the Company terminates
the Employee’s employment for any reason other than Due Cause, death or the
Employee’s disability, then the Company will pay to the Employee his Base Salary
in equal installments to be paid in accordance with the payroll policies of the
Company as in effect on the date of termination (which will be at least every 30
days) for a twelve (12) month period following such termination (each payment
shall be deemed to constitute a separate payment). The Company will also provide
at the Company’s cost twelve (12) months of health care benefits for Employee
and his family under the then existing basic group health benefit plans
determined in accordance with the terms and conditions of those plans; provided,
however, that if the Company’s group health plan is self-

 

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insured, such premiums will be paid by the Company on an after-tax basis to the
Employee. After the end of the twelve (12) month period of health coverage after
termination, the Employee shall be entitled to elect continuation coverage in
accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended and the applicable regulations.

 

  (e) The Company’s obligation to pay the severance amounts is conditioned on
Employee’s execution and delivery of the Company’s standard form Release of
Claims Agreement.

4. Covenant Not to Compete. The Employee recognizes that the Company is engaged
in a highly competitive business and that keeping the Company’s competitors from
utilizing the Company’s production processes, know-how, and proprietary
techniques and methods is of utmost importance. The Employee acknowledges that
in his position as Senior Vice President – Operations he will be exposed and
knowledgeable about the Company’s production process, know-how, proprietary
techniques and methods and other confidential information. The Employee,
therefore, agrees that during the term of his employment and for a period of
three (3) years after the date of termination of employment for any reason, he
will not accept employment or render service or assistance to the Company’s
primary domestic competitor, Daybrook Fisheries or any affiliates thereof.

If the provisions of this Section 4 are violated in any material respect, the
Company shall be entitled, upon application to any court of proper jurisdiction,
to a temporary restraining order or preliminary injunction (without the
necessity of posting any bond with respect thereto) to restrain and enjoin the
Employee from that violation. If the provisions of this Section 4 should ever be
deemed to exceed the time, geographic or occupational limitations permitted by
the applicable law, the Employee and the Company agree that such provisions
shall be and are hereby reformed to the maximum time, geographic or occupational
limitations permitted by the applicable law.

5. Confidential Information. The Employee acknowledges that he has had and will
continue to have access to trade secrets and other confidential, nonpublic
and/or proprietary information of the Company, including information derived
from production records, quality control reports, managers’ reports, claims
reports investigations, research, marketing and sale programs, strategic plans,
and customer lists (collectively, “Confidential Information”). The Employee
agrees, therefore, that he will not at any time, either while employed by the
Company or for a five (5)-year period thereafter, knowingly make any personal or
independent use of, or knowingly disclose to any other person any Confidential
Information. Confidential Information shall not include (i) information that
becomes known to the public generally through no fault of the Employee, or
(ii) information required to be disclosed by law or legal process or the order
of any governmental authority under color of law. In the event of a breach or
threatened breach by the Employee of the provisions of this Section 5 with
respect to any Confidential Information, the Company shall be entitled to a
temporary restraining order and a preliminary and permanent injunction (without
the necessity of posting any bond in connection therewith) restraining the
Employee from disclosing, in whole or in part, that Confidential Information.

 

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Sections 4 and 5 are not intended to replace or terminate, but are in addition
to, the Employee’s Confidentiality, Assignment of Invention and Non-Compete
Agreement previously executed by the Employee.

6. Notices. All notices, requests, demands and other communications given under
or by reason of this Agreement must be in writing and will be deemed given when
delivered in person or when mailed, by certified mail (return receipt
requested), postage prepaid, addressed as follows or to such other address as a
party may specify by notice pursuant to this provision:

 

If to the Company:    Omega Protein Corporation          2105 City West Blvd,
Suite 500          Houston, Texas 77042          Attn: Secretary    If to the
Employee:    Joseph E. Kadi         

 

        

 

  

7. Governing Law. This Agreement will be governed by and construed in accordance
with the substantive laws (other than the rules governing conflicts of laws) of
the State of Texas.

8. Term. The term of this Agreement shall continue in effect until an event
specified in Section 3 shall have occurred, at which point the provisions of
that section will control and after the completion of the requirements of such
provisions and Sections 4 and 5 of this Agreement, this Agreement will
terminate.

9. Entire Agreement and Amendments. This Agreement contains the entire agreement
of the Employee and the Company relating to the matters contained herein and
supersedes all prior agreements and understandings, oral or written, between the
Employee and the Company with respect to the subject matter hereof. This
Agreement may not be amended or modified except by an agreement in writing
signed by both parties.

10. Headings. The headings of sections and subsections hereof are included
solely for convenience of reference and will not control the meaning or
interpretation of any of the provisions hereof.

11. Tax Withholding. Notwithstanding any other provision hereof, the Company may
withhold from amounts payable hereunder all federal, state, local and foreign
taxes that are required to be withheld by applicable laws or regulations.

12. Separability. If any provision of this Agreement is rendered or declared
illegal, invalid or unenforceable by reason of any existing or subsequently
enacted legislation or by the final judgment of any court of competent
jurisdiction, the Employee and the Company will promptly meet and negotiate
substitute provisions for those rendered or declared illegal or unenforceable to
preserve the original intent of this Agreement to the extent legally possible,
but all other provisions of this Agreement shall remain in full force and
effect.

 

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13. Assignments. The Company may assign this Agreement to any person or entity
succeeding to all or substantially all the business interests of the Company by
merger or otherwise with the written consent of the Employee. The rights and
obligations of the Employee under this Agreement are personal to him, and none
of those rights, benefits or obligations will be subject to voluntary or
involuntary alienation, assignment or transfer.

14. Effect of Agreement. Subject to the provisions of Section 13 with respect to
assignments, this Agreement will be binding on the Employee and his heirs,
executors, administrators, legal representatives and assigns and on the Company
and its successors and assigns.

15. Execution. This Agreement may be executed in multiple counterparts, each of
which will be deemed an original and all of which will constitute one and the
same agreement.

16. Waiver of Breach. The waiver by either party to this Agreement of a breach
of any provision of the Agreement by the other party will not operate or be
construed as a waiver by the waiving party of any subsequent breach by the other
party.

17. Section 409A. The Company and Employee agree that this Agreement is intended
to comply with the requirements of Section 409A (“Section 409A”) of the Internal
Revenue Code of 1986, as amended, and the regulations and other guidance
promulgated thereunder (the “Code”) or an exemption from Section 409A and,
accordingly, this Agreement and Amendment shall be interpreted to be consistent
with Section 409A. In the event that, as of the date of Employee’s “separation
from service,” as defined in Treasury Regulation Section 1.409A-1(h), Employee
is a “specified employee,” as defined in Treasury Regulation
Section 1.409A-1(i), to the extent that any of the payments under this Agreement
and Amendment payable on account of a separation from service, including without
limitation, any payments in Sections 3d(i) and (ii) are deferred compensation
subject to, and not exempt from, Code Section 409A, such amounts shall be paid
not earlier than six (6) months after the date of the Employee’s separation from
service within the meaning of Code Section 409A (“Waiting Period”); any payments
withheld during the Waiting Period will be paid in a lump sum amount on the
first business day of the seventh month following the Employee’s separation from
service and payments thereafter shall be otherwise paid as provided herein. For
the purposes of Code Section 409A, to the extent any payment under this
Agreement is deferred compensation subject to and not exempt from Code
Section 409A, the Employee’s termination from the Company shall mean a
separation from service within the meaning of Code Section 409A.

IN WITNESS WHEREOF, the Employee and the Company have executed this Agreement
effective as of the date first written above.

 

OMEGA PROTEIN CORPORATION

By:

 

 

  Joseph L. von Rosenberg III   President and Chief Executive Officer

 

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EMPLOYEE

 

 

 

Joseph E. Kadi

 

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