**Exhibit10.4**

 

**EMPLOYMENTAGREEMENT**

 

This Employment Agreement and its Exhibits (this “Agreement”), entered into the 23rdday of April, 2008, effective as of January 1, 2008 is by andbetween Dynamic Materials Corporation, a Delaware corporation (the “Company”), and Richard A.Santa, a resident of the State of Colorado (“Executive”) (together, the “parties”).

 

**Recitals**

 

**A.           **Executive has significant experience inthe management of companies and is willing to serve the Company on the termsand subject to the conditions hereinafter set forth.

 

**B.           **The Company desires to secure thecontinued services of Executive subject to the terms and conditions hereinafterset forth.

 

**C.           **This agreement replaces, in its entirety,that certain Employment Agreement between the Company and Executive dated March 3,2005.

 

**Agreement**

 

In consideration of the foregoing and the mutual covenants and promisescontained herein, and for other good and valuable consideration, the receiptand sufficiency of which are hereby acknowledged, the parties agree as follows:

 

# **1.             Employment.** The Company hereby employs Executive as Senior Vice President and ChiefFinancial Officer of the Company reporting to the Chief Executive Officer ofthe Company, and Executive hereby accepts such employment and agrees to performsuch duties and responsibilities as are assigned to him from time-to-time bythe Chief Executive Officer of the Company.

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# **2.             Full-time Best Efforts.**  Executive shalldevote his full and exclusive professional time and attention to the performanceof his obligations under this Agreement, and will at all times faithfully,industriously and to the best of his ability, experience and talent, performall of this obligations hereunder. Executive shall not, without the express written consent of the Company,directly or indirectly, engage, alone or with others, in any other enterprisesor business concerns, nor render professional services to, own, control,manage, consult with, be employed by, or otherwise have an interest in, anysuch enterprises or concerns, during the term of his continued employment withthe Company.  Without limiting thegenerality of any other provision herein, transactions in securities ofpublicly traded companies and other passive investment activities shall not beconsidered prohibited by the foregoing sentence, except as such transactionsand activities may violate the Company’s conflict of interest policy, if any,in place from time to time.

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# **3.             Term of Agreement.**  This agreementshall be effective on January 1, 2008 (the “Effective Date”) andshall continue until December 31, 2008 (the “Term”), unlessotherwise terminated by either party pursuant to Section 5 below.

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# **4.             Compensation Reimbursement.**

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## (a)           **Salary.**  During the term of this Agreement, theCompany shall pay Executive an annual salary (“Salary”) of $275,000payable in accordance with the Company’s standard payroll practices forsimilarly situated employees.  The compensation committee of the Company’sboard of directors (the “Compensation Committee”) will review Executive’sSalary at least annually and may increase (but not reduce) Executive’s Salaryin its sole discretion.  All compensationpaid to Executive hereunder is subject to all deductions required by law.

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## (b)           **Bonus.**  Executive shall be eligible to receive anon-discretionary annual bonus equal to 1.0% of the Company’s 2008 netincome.  Executive shall also be eligibleto receive a discretionary annual bonus in an amount up to 20% of Executive’sSalary.  The discretionary bonus will bedetermined based on performance goals 

 

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and rules established by theCompensation Committee.  The bonus anddiscretionary bonus, if any, will be payable before March 15, 2009.  Executive is not guaranteed any bonuspayment.

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## (c)           **StockIncentives.**  Executiveshall be eligible to receive restricted shares of the common stock of theCompany under the Company’s 2006 Stock Incentive Plan (the “Incentive Plan”)subject to the terms and conditions of such plan and as granted by theCompensation Committee.  If the Company terminates Executive’s employmentfor any reason other than Cause pursuant to Section 5(b), all restrictedstock held by Executive shall immediately vest, subject to the terms andconditions of the Incentive Plan.

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## (d)           **Benefits. **Executive shall receive the followingCompany benefits:

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### **(i)           **termlife insurance coverage in the amount of $415,000 which is in addition to thestandard term life insurance provided in the Company’s standard benefit plan;

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### **(ii)          **participationin the Company’s executive long-term disability plan, subject to any waitingperiods or exclusions required by the insurance provider;

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### **(iii)        **fiveweeks of vacation per year until such time as Executive’s length of serviceentitles Executive to additional vacation;

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### **(iv)         **participationin the Company’s standard benefit programs including health and dentalinsurance, term life insurance, accidental death and dismemberment insurance,short and long term disability, paid holidays and certain other standardbenefits provided by the Company;

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### **(v)           **participationin the Company’s 401(k) retirement plan; and

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### **(vi)         **reimbursementof up to $5,000 of professional service fees for a financial planning and/ortax consultant to advise Executive.

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## (e)           **ExpenseReimbursement.**  TheCompany shall reimburse Executive for all travel expenses and otherdisbursements incurred by Executive for or on behalf of the Company in theperformance of his duties hereunder, subject to and in accordance with theCompany’s expense reimbursement policies and procedures, as in effect fromtime-to-time.

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# **5.             Termination.**

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## (a)           The Company may terminate Executive’semployment at any time for Cause (as hereinafter defined), effectiveimmediately upon written notice to Executive. Such notice shall specify that atermination is being made for Cause and shall state the basis therefor. Anytermination under this subparagraph shall serve to relieve Executive of all hisduties and authority on behalf of the Company as of the date such notice statesthe termination is to take effect.  Allobligations of the Company to Executive hereunder shall terminate as of theeffective date of any such termination, except for obligations accrued prior tosuch effective date.  For purposes ofthis Agreement, termination for “Cause” shall include any of the following thatdetrimentally affect the Company:

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### **(i)           **awillful and substantial breach by Executive of the terms of this Agreement orany written agreement between Executive and the Company that has a materiallyadverse effect on the business and affairs of the Company;

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### **(ii)          **thefailure by Executive to substantially perform, or the gross negligence in theperformance of, his duties hereunder for a period of fifteen days after theChief Executive Officer of the Company has made a written demand forperformance which specifically identities the manner in which he believes thatExecutive has not substantially performed his duties;

 

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### **(iii)        **thecommission by Executive of a willful act or failure to act of misconduct whichis injurious to the Company, including, but not limited to, material violationsof any Company policy (such as the Company’s code of ethics);

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### **(iv)         **aconviction or a plea of guilty or nolo contendere in connection with fraud orany crime that constitutes a felony in the jurisdiction involved; or

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### **(v)           **anact of failure to act constituting fraud or dishonesty that compromisesExecutive’s ability to act effectively as a high-level executive of theCompany.

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## (b)           The Company may terminate Executive’semployment for any reason other than Cause at any time upon the payment toExecutive of (i) an amount equal to one year’s Salary, which amount shallbe payable in twelve monthly payments (the “Termination Payments”), plus(ii) a bonus for such period, based on the average bonus (if any) paid toExecutive for the two years preceding the termination; provided, that Executiveshall execute a release, prepared by the Company, releasing the Company fromall claims as a condition of receiving the Salary and bonus (if any) pursuantto this Agreement.  Such amounts receivedunder this provision shall be reduced to the extent that Executive acceptsother employment prior to the receipt of the final Termination Payment.  Any termination under this subparagraph shallserve to relieve Executive of all his duties and authority on behalf of theCompany as of the date such notice states the termination is to takeeffect.  All obligations of the Companyto Executive under this Agreement shall terminate as of the effective date ofany such termination, except for obligations accrued prior to such effectivedate.

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## (c)           Upon the termination of Executive’semployment hereunder, neither Executive nor Executive’s beneficiary or estateshall have any further rights or claims against the Company under thisAgreement except the right to receive:

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### **(i)           **theunpaid portion of the earned Salary computed on a pro rata basis to the date oftermination;

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### **(ii)          **anyunpaid bonus owing under Section 4(b) or 5(b); and

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### **(iii)        **reimbursementfor any expenses for which Executive shall not have theretofore been reimbursedas provided in Section 4(e).

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## (d)           Notwithstanding any other provisionof this Section 5, Executive shall have the right to terminate hisemployment at any time upon sixty days’ written notice to the Company (or uponsuch shorter notice as the Company may agree in writing in connection with suchtermination). Any such termination by Executive shall be deemed effective uponreceipt by the Company of such notice. Any termination under this subparagraph shall be effective as of thedate stated in the notice and shall serve to relieve both parties from alltheir duties and obligations to one another hereunder after such date, exceptfor obligations accrued prior to such effective date.

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## (e)           If Executive dies during the term ofhis employment hereunder, this Agreement shall automatically terminate as ofthe date of his death and the parties shall be relieved from their respectiveduties and obligations to one another as of the effective date of any suchtermination.  Executive’s estate ordesignated beneficiaries shall receive any accrued but unpaid portion ofExecutive’s Salary and the bonus, if any, he would have received in respect ofthe portion of the fiscal year prior to his termination, payable at the sametime as bonuses are paid to other executives and any other amounts owing toExecutive under Section 5(c).  IfExecutive is unable to fully and satisfactorily perform any of the essentialfunctions of his position by reason of disability, with or without reasonableaccommodation as may be required under law, for a period of at least ninetyconsecutive calendar days, this Agreement and Executive’s employment hereundermay be terminated at the election of the Company, effective upon sixty days’written notice given at any time after such consecutive ninety day period ofcontinuous disability elapses, provided Executive continues to be sufferingfrom such disability at the time notice of such termination is given by theCompany.  In the event of termination underthe previous sentence, the parties shall be relieved from their respectiveduties and obligations to one another from and after the date such terminationtakes effect.  Executive shall receiveany accrued but unpaid portion of Executive’s Salary and the bonus, if any, hewould have 

 

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received in respect of the portion of thefiscal year prior to his termination, payable at the same time as bonuses arepaid to other executives and any other amounts owing to Executive under Section 5(c).  Should Executive’s disability, if any, be ofan intermittent nature, the disability shall nonetheless be considered to becontinuing during any period of time that the disability abates for seven orless consecutive calendar days, but any such intermittent periods during whichthe disability has abated for seven or less consecutive calendar days shall notbe counted for purposes of determining the consecutive ninety day period of “continuous”disability following which the Company may elect to give notice of termination.

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For purposes of this subparagraph (e), “disability” shall meanthat Executive is unable, by reason of physical or mental sickness or illness,injury, or incapacity, to perform any of the essential functions of his regularemployment by the Company.  Executiveshall be considered to be suffering from a disability if he is determined to bedisabled by any disability insurer insuring Executive on the date the conditionof disability commenced.  In the eventthere is no disability determination made by a relevant insurer, Executiveshall be considered to be suffering from a disability if, in the opinion of aqualified physician selected by mutual agreement of Executive and the Company,Executive is determined to be unable to perform any of the essential functionsof his regular employment by the Company by reason of any physical or mentalsickness, injury, or incapacity.  In theevent Executive and the Company cannot agree upon the selection of a qualifiedphysician, each party shall appoint a qualified physician of his or its choiceand the two physicians so appointed shall mutually select a qualified physicianto render the subject opinion as to whether or not Executive is suffering froma disability as defined above.  A “qualifiedphysician” shall mean a person who is licensed to practice medicine andprescribe and administer prescription drugs and/or to perform surgery in thestate of Executive’s residence at the time of the commencement of the believeddisability (or is so licensed in such other state as the parties shallreasonably agree is a convenient place in which to examine Executive and/orreview his medical records) and who is acting within the scope of his/hermedical license and qualified by his/her licensure, certification, training orexperience to render the subject opinion.

 

## (f)            Inthe event of any termination of this Agreement in connection with whichExecutive is entitled by law or is allowed by the Company to continue hiscoverage under the Company’s health, dental, eye and other medical insurancepolicies, Executive shall be responsible for paying the cost of all insurancepremiums and charges necessary to keep such coverage in force during any periodof time that such coverage is so continued following termination.

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# **6.             Proprietary Information and Non-CompetitionAgreements.**  Executiveshall be bound by the terms of the Company’s standard form of the Key EmployeeProprietary Information and Inventions Agreement, attached hereto as Exhibit A,and the Non-Competition and Non-Solicitation Agreement, attached hereto as Exhibit B,from and after the date hereof.

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# **7.             Miscellaneous.**

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(a)           **Judicial Limitation.**  In the event that any provision of thisAgreement is more restrictive than permitted by the law of the jurisdiction inwhich the Company seeks enforcement thereof, the provisions of this Agreementshall be limited only to that extent that a judicial determination finds thesame to be unreasonable or otherwise enforceable. Such invalidity or unenforceabilityshall not affect any other terms herein, but such term shall be deemed deleted,and such deletion shall not affect the validity of the other terms thereof. Inaddition, if any one or more of the terms contained in this Agreement shall forany reason be held to be excessively broad or of an overly long duration, thatterm shall be construed in a manner to enable it to be enforced to the extentcompatible with applicable law. Moreover, notwithstanding any judicialdetermination that any provision of this Agreement is not specifically enforceable the partiesintend that the Company shall nonetheless be entitled to recover monetarydamages as a result of any breach hereof.

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## (b)           **InjunctiveRelief. **In view of thenature of the rights in goodwill, business reputation and prospects of theCompany to be protected under this Agreement, Executive understands and agreesthat the Company could not be reasonably or adequately compensated in damagesin an action at law for Executive’s breach of his obligations hereunder.Accordingly, Executive specifically agrees that the Company shall be entitledto temporary and permanent injunctive relief to enforce the provisions of thisAgreement and that such relief may be granted without the necessity of provingactual damages. This provision with respect to injunctive relief shall not,however, diminish the right of the Company to claim and recover damages inaddition to injunctive relief.

 

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## (c)           **Waiver. **The failure of the Company to enforce atany time of the provisions of this Agreement or to require any performance byExecutive of the provisions hereof shall in no way be construed to be a waiverof such provisions or to affect either the validity of this Agreement, or any parthereof, or the right of the Company thereafter to enforce each and everyprovision in accordance with the terms of this Agreement.

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## (d)           **Severability.**  The invalidity or unenforceability of anyparticular provision of this Agreement shall not affect the other provisionshereof, and this Agreement shall be construed in all respects as if suchinvalid or unenforceable provisions were omitted.

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## (e)           **BindingEffect.**  This Agreementshall be binding upon the parties, their successors, executors and heirs.

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## (f)            **Assignability.**  This Agreement shall be freely assignable bythe Company and shall inure to the benefit of its successors and assigns.

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## (g)           **EntireAgreement. **This Agreement,including the Key Employee Proprietary Information and Inventions Agreement andthe Non Competition Agreement referred to herein, and which are incorporatedherein and made a part hereof by reference, embody the entire agreement andunderstanding of the parties hereto and supersede all prior agreements orunderstanding (whether written or oral) with respect to the subject matterhereof.

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## (h)           **GoverningLaw and Venue. **Thevalidity of this Agreement and any of its terms and provisions, as well as therights and duties of the parties hereunder, shall be governed by the laws ofthe State of Colorado (without regard to its conflicts of law doctrines) andthe venue for any action to enforce or to interpret this Agreement shall be ina court of competent jurisdiction located in the State of Colorado and each ofthe parties consent to the jurisdiction of such court in any such action orproceeding and waives any objection to venue laid therein.

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## (i)            **Amendments. **This agreement may not be amended,altered or modified other than by a written agreement between the partieshereto.

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## (j)            **Counterparts. **This Agreement may be executed in anynumber of counterparts, each of which shall be deemed to be an original and allof which shall together constitute one and the same instrument. This Agreementshall become binding when one or more counterparts hereof shall bear thesignatures of all the parties indicated as the signatories hereto.

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## (k)           **Notices. **All notices, requests, demands and othercommunications under the Agreement shall be given in writing and shall beserved either personally, by facsimile or delivered by first class mail,registered or certified, return receipt requested, postage prepaid and properlyaddressed to the parties as noticed herein. Notice shall be deemed receivedupon the earliest of actual receipt, confirmed facsimile or three (3) daysfollowing mailing pursuant to this section.

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If to Executive:

 

Richard A. Santa6910 Pawnee Way

Niwot, CO 80503

 

If to the Company:

 

Dynamic Materials CorporationAttention: Chief Executive Officer5405 Spine RoadBoulder, CO 80301Facsimile:  (303) 604-1897

 

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## (l)            **Interpretation. **Each party has had the opportunity andhas reviewed and revised this Agreement (and has had an opportunity to consultwith counsel if desired) and, therefore, the rule of constructionrequiring that any ambiguity be resolved against the drafting party shall notbe employed in the interpretation of this Agreement.** **The section headingscontained in this Agreement are for convenience and reference purposes only andshall not affect in any way the meaning and interpretation of this Agreement.

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## (m)          **Attorney’sFees and Costs. **If eitherparty shall commence any action or proceeding against the other to enforce theprovisions hereof, or to recover damages as a result of the alleged breach ofany provisions hereof, the prevailing party therein shall be entitled torecover all reasonable costs incurred in connection therewith, includingreasonable attorney’s fees.

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[Signature Page Follows]

 

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**Acknowledgment**

 

**Each party’s signature below acknowledges that theparty has read this document fully, that the party fully understands and agreesto its contents and effect, that the party understands that it is a legallybinding document, that the party is mentally and physically competent andcapable of reading, understanding and signing this Agreement, and that theparty has signed this document voluntarily and of its own free will, and not asa result of any pressure or coercion. Each party’s signature below further acknowledges that the party has hadthe opportunity to consult with an attorney about the meaning and effect of theterms of this Agreement and that each party has in fact consulted with anattorney of the party’s own choosing about this Agreement.**

 

This Agreement is executed as of the date first set above:

 

 
|   | DYNAMIC MATERIALS  CORPORATION |
|--------|--------------------------------|
|   |                           |   |
|   |                           |   |
|   | By:                            | /s/ Yvon Cariou |
|   |                           | Yvon Cariou |
|   |                           | President and Chief  Executive Officer |
|   |                           |   |
|   |                           |   |
|   | EXECUTIVE                      |
|   |                           |   |
|   |                           |   |
|   | /s/  Richard A. Santa          |
|   | Richard A. Santa               |

 

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**[EXHIBITS OMITTED]**

** **

** [Company-Wide Form Of  Certain Employment Agreements]**

 

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**2009AMENDMENT TO EMPLOYMENT AGREEMENT**

 

This 2009 Amendment to Employment Agreement (this “Amendment”), entered into the 4th day of February, 2009, effective as of January 1, 2009, isby and between Dynamic Materials Corporation, a Delaware corporation (the “Company”), and Richard A.Santa, a resident of the State of Colorado (“Executive”).  ThisAmendment amends the Employment Agreement dated April 23, 2008 to be effective as of January 1,2008, between the Company and Executive(the “Agreement”).

 

In consideration of the foregoing and the mutual covenants and promisescontained herein, and for other good and valuable consideration, the receiptand sufficiency of which are hereby acknowledged, the parties agree as follows:

 

# **1.             Term.** Section 3 of the Agreement is hereby amended by replacing “2008”with “2009” in both occurrences.

#  

# **2.             Salary**.  Section 4(a) of the Agreement ishereby amended by replacing “$275,000” with “$284,625.”

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# **3.             Non-discretionary Annual Bonus.**  Section 4(b) ofthe Agreement is hereby amended to read in its entirety as follows:

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## (b)           Bonus. Executive shall be eligible to receive a non-discretionary annual bonusequal to an amount equal to 1.0% of the Company’s2009 net income up to an amount equal to 125% of such Executive’s Salary andthereafter 0.5% of the Company’s 2009 net income.  Executive shall also be eligible to receive adiscretionary annual bonus in an amount up to 20% of Executive’s Salary.  The discretionary bonus will be determinedbased on performance goals and rules established by the CompensationCommittee.  The bonus and discretionarybonus, if any, will be payable before March 15, 2010.  Executive is not guaranteed any bonus payment.

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# **4.             Miscellaneous**.  All other provisions of the Agreement shallremain effective.

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# In witness whereof, the parties haveexecuted this Amendment as of the date set forth above.

 
|   | DYNAMIC MATERIALS  CORPORATION |
|--------|--------------------------------|
|   |                           |   |
|   |                           |   |
|   | By:                            | /s/ Yvon Cariou |
|   |                           | Yvon Cariou |
|   |                           | President and Chief  Executive Officer |
|   |                           |   |
|   |                           |   |
|   | EXECUTIVE                      |
|   |                           |   |
|   |                           |   |
|   | /s/  Richard A. Santa          |
|   | Richard A. Santa               |

 

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**2010AMENDMENT TO EMPLOYMENT AGREEMENT**

 

This 2010 Amendment to Employment Agreement (this “Amendment”), entered into the 5th dayof March, 2010, effective as of January 1, 2010, is by and betweenDynamic Materials Corporation, a Delaware corporation (the “Company”), and Richard A.Santa, a resident of the State of Colorado (“Executive”).  ThisAmendment further amends the Employment Agreement dated April 23, 2008 tobe effective as of January 1, 2008, between the Company and Executive, as amended by the 2009 Amendment(the “Agreement”).

 

In consideration of the foregoing and the mutual covenants and promisescontained herein, and for other good and valuable consideration, the receiptand sufficiency of which are hereby acknowledged, the parties agree as follows:

 

# **1.             Term.** Section 3 of the Agreement is hereby amended to read in itsentirety as follows:

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## This agreementshall be effective on January 1, 2010 (the “Effective Date”) andshall continue until December 31, 2012 (the “Term”), unlessotherwise terminated by either party pursuant to Section 5 below.

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# **2.             Termination. **Section 5(b) ofthe Agreement is hereby amended to read in its entirety as follows:

#  

## (b)           The Company may terminate Executive’semployment for any reason other than Cause at any time upon the payment toExecutive of (i) an amount equal to the greater of (A) the remainingSalary payable through the Term of this Agreement, or (B) one year’sSalary, which amount shall be payable in equal monthly payments (the “TerminationPayments”), plus (ii) a bonus for such period, equal to (X) theamount of the average bonus (if any) paid to Executive for the two yearspreceding the termination, multiplied by (Y) three, two or one if theExecutive’s employment is terminated pursuant to this Section 5(b) duringthe first, second or third, respectively, 12-month period of the Term;provided, that Executive shall execute a release, prepared by the Company,releasing the Company from all claims as a condition of receiving the Salaryand bonus (if any) pursuant to this Agreement. Such amounts received under this provision shall be reduced to theextent that Executive accepts other employment prior to the receipt of thefinal Termination Payment.  Anytermination under this subparagraph shall serve to relieve Executive of all hisduties and authority on behalf of the Company as of the date such notice statesthe termination is to take effect.  Allobligations of the Company to Executive under this Agreement shall terminate asof the effective date of any such termination, except for obligations accruedprior to such effective date.

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# **3.             Miscellaneous**.  All other provisions of the Agreement shallremain effective.

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# In witness whereof, the parties haveexecuted this Amendment as of the date set forth above.

 
|   | DYNAMIC MATERIALS  CORPORATION |
|--------|--------------------------------|
|   |                           |   |
|   |                           |   |
|   | By:                            | /s/ Yvon Cariou |
|   |                           | Yvon Cariou |
|   |                           | President and Chief  Executive Officer |
|   |                           |   |
|   |                           |   |
|   | EXECUTIVE                      |
|   |                           |   |
|   |                           |   |
|   | /s/  Richard A. Santa          |
|   | Richard A. Santa               |

 

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