**Exhibit10.3**

 

**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 Yvon Cariou, aresident 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 Companyhereby employs Executive as President and Chief Executive Officer of theCompany reporting to the board of directors of the Company, and Executivehereby accepts such employment and agrees to perform such duties andresponsibilities as are assigned to him from time-to-time by the board ofdirectors of the Company.

 

**2.****                                     ****Full-time****Best****Efforts****.**  Executive shall devote his full and exclusiveprofessional time and attention to the performance of his obligations underthis Agreement, and will at all times faithfully, industriously and to the bestof his ability, experience and talent, perform all of this obligationshereunder.  Executive shall not, withoutthe express written consent of the Company, directly or indirectly, engage,alone or with others, in any other enterprises or business concerns, nor renderprofessional services to, own, control, manage, consult with, be employed by,or otherwise have an interest in, any such enterprises or concerns, during the termof his continued employment with the Company. Without limiting the generality of any other provision herein,transactions in securities of publicly traded companies and other passiveinvestment activities shall not be considered prohibited by the foregoingsentence, except as such transactions and activities may violate the Company’sconflict of interest policy, if any, in place from time to time.

 

**3.****                                     ****Termof****Agreement****.**  This agreement shall be effective on January 1,2008 (the “Effective Date”) and shall continue until December 31,2008 (the “Term”), unless otherwise terminated by either party pursuantto Section 5 below.

 

**4.****                                     ****CompensationReimbursement****.**

 

(a)                                  **Salary****.**  During the term of this Agreement, theCompany shall pay Executive an annual salary (“Salary”) of $440,000payable 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.

 

(b)                                 **Bonus****.**  Executive shall be eligible to receive anon-discretionary annual bonus equal to 2.5% of the Company’s 2008 netincome.  Executive shall also be eligibleto receive a discretionary annual bonus in an amount up to 25% of Executive’sSalary.  The discretionary bonus will bedetermined based on performance goals 

 

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and rules established by the Compensation Committee.  The bonus and discretionary bonus, if any,will be payable before March 15, 2009. Executive is not guaranteed any bonus payment.

 

(c)                                  **Stock****Incentives****.**  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:

 

### **(i)****                                   **termlife insurance coverage in the amount of $750,000 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)                                  **Expense****Reimbursement****.**  The Companyshall reimburse Executive for all travel expenses and other disbursementsincurred by Executive for or on behalf of the Company in the performance of hisduties hereunder, subject to and in accordance with the Company’s expensereimbursement policies and procedures, as in effect from time-to-time.

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**5.****                                     ****Termination****.**

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## (a)                                  TheCompany may terminate Executive’s employment at any time for Cause (ashereinafter defined), effective immediately upon written notice to Executive.Such notice shall specify that a termination is being made for Cause and shallstate the basis therefor. Any termination under this subparagraph shall serveto relieve Executive of all his duties and authority on behalf of the Companyas of the date such notice states the termination is to take effect.  All obligations of the Company to Executivehereunder shall terminate as of the effective date of any such termination,except for obligations accrued prior to such effective date.  For purposes of this Agreement, terminationfor “Cause” shall include any of the following that detrimentally affect theCompany:

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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;

 

### **(ii)****                               **thefailure by Executive to substantially perform, or the gross negligence in theperformance of, his duties hereunder for a period of fifteen days after theBoard of the Company has made a written demand for performance whichspecifically identities the manner in which he believes that Executive has notsubstantially 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 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)                                 TheCompany may terminate Executive’s employment for any reason other than Cause atany time upon the payment to Executive of (i) an amount equal to one year’sSalary, which amount shall be payable in twelve monthly payments (the “TerminationPayments”), plus (ii) a bonus for such period, based on the averagebonus (if any) paid to Executive for the two years preceding the termination;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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## (c)                                  Uponthe termination of Executive’s employment hereunder, neither Executive norExecutive’s beneficiary or estate shall have any further rights or claimsagainst the Company under this Agreement 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;

 

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

 

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

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## (d)                                 Notwithstandingany other provision of this Section 5, Executive shall have the right toterminate his employment at any time upon sixty days’ written notice to theCompany (or upon such shorter notice as the Company may agree in writing inconnection with such termination). Any such termination by Executive shall bedeemed effective upon receipt by the Company of such notice.  Any termination under this subparagraph shallbe effective as of the date stated in the notice and shall serve to relieveboth parties from all their duties and obligations to one another hereunderafter such date, except for obligations accrued prior to such effective date.

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## (e)                                  IfExecutive dies during the term of his employment hereunder, this Agreementshall automatically terminate as of the date of his death and the parties shallbe relieved from their respective duties and obligations to one another as ofthe effective date of any such termination. Executive’s estate or designated beneficiaries shall receive any accruedbut unpaid portion of Executive’s Salary and the bonus, if any, he would havereceived in respect of the portion of the fiscal year prior to his termination,payable at the same time as bonuses are paid to other executives and any otheramounts owing to Executive under Section 5(c).  If Executive is unable to fully andsatisfactorily perform any of the essential functions of his position by reasonof disability, with or without reasonable accommodation as may be requiredunder law, for a period of at least ninety consecutive calendar days, thisAgreement and Executive’s employment hereunder may be terminated at theelection of the Company, effective upon sixty days’ written notice given at anytime after such consecutive ninety day period of continuous disability elapses,provided Executive continues to be suffering from such disability at the timenotice of such termination is given by the Company.  In the event of termination under theprevious sentence, the parties shall be relieved from their respective dutiesand obligations to one another from and after the date such termination takeseffect.  Executive shall receive anyaccrued but unpaid portion of Executive’s Salary and the bonus, if any, hewould have 

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## received in respect of theportion of the fiscal year prior to his termination, payable at the same timeas bonuses are paid to other executives and any other amounts owing toExecutive under Section 5(c). Should Executive’s disability, if any, be of an intermittent nature, thedisability shall nonetheless be considered to be continuing during any periodof time that the disability abates for seven or less consecutive calendar days,but any such intermittent periods during which the disability has abated forseven or less consecutive calendar days shall not be counted for purposes ofdetermining the consecutive ninety day period of “continuous” disabilityfollowing 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.  Executive shallbe 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 insurance policies,Executive shall be responsible for paying the cost of all insurance premiumsand charges necessary to keep such coverage in force during any period of timethat such coverage is so continued following termination.

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**6.****                                     ****ProprietaryInformation and Non-****Competition****Agreements****.**  Executive shall be bound by the terms of the Company’sstandard form of the Key Employee Proprietary Information and InventionsAgreement, attached hereto as Exhibit A, and the Non-Competition andNon-Solicitation Agreement, attached hereto as Exhibit B, from and afterthe date hereof.

 

**7.****                                     ****Miscellaneous****.**

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(a)                                  **Judicial****Limitation****.**  In the eventthat any provision of this Agreement is more restrictive than permitted by thelaw of the jurisdiction in which the Company seeks enforcement thereof, theprovisions of this Agreement shall be limited only to that extent that ajudicial determination finds the same to be unreasonable or otherwiseenforceable. Such invalidity or unenforceability shall not affect any otherterms herein, but such term shall be deemed deleted, and such deletion shallnot affect the validity of the other terms thereof. In addition, if any one ormore of the terms contained in this Agreement shall for any reason be held tobe excessively broad or of an overly long duration, that term shall beconstrued in a manner to enable it to be enforced to the extent compatible withapplicable law. Moreover, notwithstanding any judicial determination that anyprovision of this Agreement is not specifically enforceable theparties intend that the Company shall nonetheless be entitled to recovermonetary damages as a result of any breach hereof.

 

(b)                                 **Injunctive Relief****. **In view ofthe nature 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 anypart hereof, or the right of the Company thereafter to enforce each and everyprovision in accordance with the terms of this Agreement.

 

(d)                                 **Severability****.**  The invalidityor unenforceability of any particular provision of this Agreement shall notaffect the other provisions hereof, and this Agreement shall be construed inall respects as if such invalid or unenforceable provisions were omitted.

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(e)                                  **Binding****Effect****.**  This Agreement shall be binding upon theparties, their successors, executors and heirs.

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(f)                                    **Assignability****.**  This Agreementshall be freely assignable by the Company and shall inure to the benefit of itssuccessors and assigns.

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(g)                                 **Entire****Agreement****. **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)                                 **Governing****Law 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****. **Thisagreement may not be amended, altered or modified other than by a writtenagreement between the parties hereto.

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(j)                                     **Counterparts****. **ThisAgreement may be executed in any number of counterparts, each of which shall bedeemed to be an original and all of which shall together constitute one and thesame instrument. This Agreement shall become binding when one or morecounterparts hereof shall bear the signatures of all the parties indicated asthe 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:

 

Yvon Cariou1995 East Coalton Road# 7 — 302Superior CO 80027

 

If to the Company:

 

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

 

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(l)                                     **Interpretation****. **Each partyhas had the opportunity and has reviewed and revised this Agreement (and hashad an opportunity to consult with counsel if desired) and, therefore, the rule ofconstruction requiring that any ambiguity be resolved against the draftingparty shall not be 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.

 

(m)                               **Attorney’s Fees 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.

 

[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/ Richard A. Santa |
|   |                           | Richard A Santa |
|   |                           | Senior Vice President  and Chief Financial Officer |
|   |                           |
|   |                           |
|   | EXECUTIVE                      |
|   |                           |
|   |                           |
|   | /s/ Yvon Cariou                |
|   | Yvon Cariou                    |

 

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**[EXHIBITS OMITTED]**

 

[Company-WideForm Of  Certain EmploymentAgreements]

 

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**2009AMENDMENT TO EMPLOYMENT AGREEMENT**

 

This 2009 Amendment to Employment Agreement (this “Amendment”), entered into the 4th dayof February, 2009, effective as of January 1, 2009, is by andbetween Dynamic Materials Corporation, a Delaware corporation (the “Company”), and Yvon Cariou, aresident of the State of Colorado (“Executive”).  This Amendment amends the EmploymentAgreement  dated April 23, 2008 tobe 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 herebyamended by replacing “2008” with “2009” in both occurrences.

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**2.****                                     ****Salary**.  Section 4(a) ofthe Agreement is hereby amended by replacing “$440,000” with “$455,400.”

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**3.****                                     ****Non-****discretionary****Annual Bonus****.**  Section 4(b) of the Agreement is herebyamended to read in its entirety as follows:

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(b)                                 Bonus.  Executive shall be eligible to receive anon-discretionary annual bonus equal to an amount equal to 2.5% ofthe Company’s 2009 net income up to an amount equal to 175% of such Executive’sSalary and thereafter 1.0% of the Company’s 2009 net income.  Executive shall also be eligible to receive adiscretionary annual bonus in an amount up to 25% 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.

 

**4.****                                     ****Miscellaneous**.  All otherprovisions of the Agreement shall remain 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/ Richard A. Santa |
|   |                          | Richard A. Santa |
|   |                          | Senior Vice President  andChief  Financial Officer |
|   | ** **                    |
|   | ** **                    |
|   | EXECUTIVE                     |
|   |                          |
|   |                          |
|   | /s/ Yvon Cariou               |
|   | Yvon Cariou                   |

 

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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 Yvon Cariou, aresident of the State of Colorado (“Executive”).  This Amendment further amends the EmploymentAgreement dated April 23, 2008 to be effective as of January 1,2008, between the Company andExecutive, 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 herebyamended to read in its entirety 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:

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## (b)                                 TheCompany may terminate Executive’s employment for any reason other than Cause atany time upon the payment to Executive of (i) an amount equal to thegreater of (A) the remaining Salary payable through the Term of thisAgreement, or (B) one year’s Salary, which amount shall be payable inequal monthly payments (the “Termination Payments”), plus (ii) abonus for such period, equal to (X) the amount of the average bonus (ifany) paid to Executive for the two years preceding the termination, multipliedby (Y) three, two or one if the Executive’s employment is terminatedpursuant to this Section 5(b) during the first, second or third,respectively, 12-month period of the Term; provided, that Executive shallexecute a release, prepared by the Company, releasing the Company from allclaims as a condition of receiving the Salary and bonus (if any) pursuant tothis 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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**3.****                                     ****Miscellaneous**.  All otherprovisions of the Agreement shall remain effective.

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# In witness whereof, the parties have executed this Amendmentas of the date set forth above.

 
|   | DYNAMIC MATERIALS  CORPORATION |
|--------|--------------------------------|
|   |                           |
|   |                           |
|   |                           |
|   | By:                            | /s/ Richard A. Santa |
|   |                           | Richard A. Santa |
|   |                           | Senior Vice President  andChief  Financial Officer |
|   |                           |
|   |                           |
|   | EXECUTIVE                      |
|   |                           |
|   |                           |
|   | /s/ Yvon Cariou                |
|   | Yvon Cariou                    |

 

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