Document:

Exhibit 4.3

 

Warrant Purchase Agreement

 

This Warrant Purchase Agreement (this "Agreement") dated as of October 4, 2018, by and among (i) Magal Security Systems Ltd. ("Purchaser" or "Company") and (ii) the sellers whose names appear on Exhibit I hereto (each a "Seller", and collectively the "Sellers").

 

	WHEREAS,	
Pursuant to a Share Purchase Agreement dated December 30, 2012 between the Company, Websilicon Network Integrations Ltd. ("Websilicon") and the shareholders of Websilicon (the "SPA"), the Company granted to Sellers warrants to purchase an aggregate amount of 898,203 ordinary shares of the Company, par value NIS 1.00 each ("Ordinary Shares"), pursuant to the warrant agreements listed in Exhibit II hereto (the "Warrants"); and

 

	WHEREAS,	
Of such Warrants, an aggregate amount of 60,000 Warrants (20,000 Warrants by each Seller), were exercised by the Sellers into Ordinary Shares prior to the date hereof; and

 

	WHEREAS,	
As of the date hereof, the Sellers collectively hold 838,203 Warrants (the "Purchased Warrants"); and

 

	WHEREAS,	
The Sellers desire to sell, and the Purchaser desires to purchase, all of the Purchased Warrants on the terms and subject to the conditions set forth herein (the "Transaction").

 

NOW, THEREFORE, in consideration of the mutual promises, conditions, representations and warranties set forth herein, and intending to be legally bound hereby, the parties agree as follows:

 

	1.	
Sale and Purchase of the Purchased Warrants.

 

		1.1.	
Subject to the terms and conditions herein, at the Closing (as defined below), the Sellers shall sell, and the Purchaser shall purchase, for an aggregate cash purchase price of US$ 375,000 (Three Hundred Seventy Five Thousand US Dollars) (the "Purchase Price") all of the Purchased Warrants. The allocation of the Purchase Price between the Sellers shall be as set forth in Exhibit I hereto.

 

		1.2.	
Tax Withholding. Purchaser shall be entitled to deduct and withhold from the Purchase Price such amounts as Purchaser is required to deduct and withhold under applicable law, with respect to any Seller, unless such Seller provides Purchaser an approval or certification from the applicable tax authorities instructing Purchaser (i) not to withhold taxes with respect to such Seller, or (ii) setting forth the withholding rate applicable to such Seller, in which case the Purchaser shall withhold and transfer to the applicable tax authorities such percentage of the payment due to such Seller as specified in the certification, and shall be required to pay to such Seller only the balance of the payment due to such Seller and not so withheld.  To the extent that amounts are so withheld by Purchaser, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Seller in respect of which such deduction and withholding was made by Purchaser. Purchaser shall promptly provide to a Seller in respect of whom such amounts were withheld, written confirmation of the amount so withheld.

 

	2.	
Closing. Unless otherwise mutually agreed in writing among Purchaser and the Sellers, the closing of the Transaction (the “Closing”) shall take place at the offices of Naschitz, Brandes, Amir & Co., 5 Tuval St., Tel Aviv, on the date on which the last to be satisfied or waived of the conditions set forth in Section 6 (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions) shall have been satisfied or waived in accordance with this Agreement (the “Closing Date”). At the Closing, the following transactions shall occur simultaneously (no transaction shall be deemed to have been completed or any document delivered until all such transactions have been completed and all required documents delivered):

 

		2.1.	
Each Seller shall deliver to the Purchaser a validly executed deed of assignment, substantially in the form attached hereto as Exhibit A, covering the Seller's Purchased Warrants being transferred from such Seller to the Purchaser and shall deliver to the Purchaser the original warrant certificate(s) representing such Purchased Warrants issued in the name of the Seller or a declaration that such warrant certificate(s) were lost, in the form acceptable to the Purchaser and the Purchaser.

 

		2.2.	
Subject to Section 1.2, the Purchaser shall pay the Purchase Price to each Seller by wire transfer to each Seller's bank account set forth in Exhibit I hereto.

 

	3.	
Representations and Warranties of Each Seller. Each of the Sellers, severally and not jointly, hereby represents and warrants to the Purchaser, that on the date hereof and on the Closing Date:

 

		3.1.	
Seller has the full power and authority to execute and perform this Agreement and each document, instrument and agreement attached hereto which are required to be executed by the Seller in connection with this Agreement. This Agreement and each document, instrument and agreement attached hereto which are required to be executed by the Seller in connection with this Agreement constitutes the valid and binding obligation of Seller, enforceable against him/her in accordance with its terms.

 

		3.2.	
Seller is the lawful and record (or beneficial owner, as applicable) owner of his portion of the Purchased Warrants as set forth in Exhibit I attached hereto, and upon sale and delivery of, and payment for, his Purchased Warrants, as provided herein, Seller will convey to the Purchaser at the Closing good and marketable title to his Purchased Warrants, free and clear of any and all Liens. “Lien” means any lien, pledge, hypothecation, mortgage, right of others, adverse claims, deed of trust, security interest, charge, option, right of first refusal, easement, trust, equitable interest, servitude, proxy, encumbrance, interference, usufruct, voting trust agreement, or rights of third parties of any nature (including any spousal community property rights, decree of divorce or separate maintenance, property settlement, separation agreement or other agreement with a spouse), or other restriction or limitation, including any restriction on the right to vote, sell or otherwise dispose of the Purchased Warrant to the Purchaser hereunder.

 

		3.3.	
The execution and performance by Seller of this Agreement and each document, instrument and agreement attached hereto which are required to be executed by the Seller in connection with this Agreement, and all transactions contemplated herein or therein do not require the consent or approval of, or the giving the notice to, any person, except for the approval of the competent courts in Israel as set forth in Section 6 below.

 

		3.4.	
The Seller is capable of evaluating the value of his portion of the Purchased Warrants to be sold by such Seller hereunder, has made its own due diligence analysis in his or her decision to sell his portion of the Purchased Warrants to be sold by such Seller hereunder, and has not relied in connection with the sale of such shares upon any advice, representations, warranties or agreements of the Purchaser or any of Purchaser's legal or tax counsels. The Seller represents that he will not have any claim or demand against the Purchaser or anyone on its behalf in connection with this Agreement in the event that in the future the Seller learns of any information not known to Seller today with respect to the Purchaser, the Purchased Warrants or the value thereof. Seller acknowledges that he will have no future participation in any Company gains, losses, profits or distributions with respect to the Purchased Warrants or the shares underlying such Purchased Warrants sold by him under this Agreement. If the Purchased Warrants or the shares underlying such Purchased Warrants increase in value by any means, Seller acknowledges that Seller is voluntarily forfeiting any opportunity to share in any resulting increase in value from the Purchased Warrants or the shares underlying such Purchased Warrants. The Seller further acknowledges that the Purchaser may have a different knowledge and view of the prospects and potential, relative to the Seller. Thus, Seller acknowledges that he has agreed to sell his portion of the Purchased Warrants to the Purchaser at the consideration provided for herein notwithstanding any such possible knowledge differential or any potential or prospects the Purchaser may view for the Company, and waives any right, claim or demand that may arise as a result thereof against the Purchaser or anyone on its behalf.

 

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		3.5.	
The Seller acknowledges that: (i) he has had the opportunity to be represented by legal counsel throughout the negotiations which preceded the execution of this Agreement; (ii) he has read the entirety of this Agreement and knows and understands the contents hereof; (iii) he has executed this Agreement with the advice of legal counsel, if represented; and (iv) he has signed this Agreement, including the releases contained herein, voluntarily and freely.

 

		3.6.	
Seller hereby expressly acknowledges that he is aware that the Company is a public company whose shares are traded in NASDAQ, and (ii) the securities laws and the regulations and rules promulgated thereunder (hereinafter: the “Securities Laws”) strictly prohibit persons who hold non-public information that relate to a public company such as the Company (whether obtained directly and/or indirectly from that company) from purchasing or selling securities of such company, or from communicating such information to any other person under circumstances in which it is reasonably foreseeable and/or possible that a person receiving such information may and/or is likely to purchase or sell such securities. Accordingly, Seller hereby expressly undertakes that he shall not take any action that results in violation of and/or non-compliance with, any applicable Securities Laws.

 

	4.	
Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to the Sellers that on the date hereof and on the Closing Date:

 

		4.1.	
Purchaser has the full power and authority to execute and perform this Agreement and each document, instrument and agreement attached hereto which are required to be executed by the Purchaser in connection with this Agreement. This Agreement and each document, instrument and agreement attached hereto which are required to be executed by the Purchaser in connection with this Agreement constitutes the valid and binding obligation of Purchaser, enforceable against it in accordance with its terms.

 

		4.2.	
The execution and performance by Purchaser of this Agreement and each document, instrument and agreement attached hereto which are required to be executed by the Purchaser in connection with this Agreement do not require the consent or approval of any person, except for the approval of the competent courts in Israel as set forth in Section 6 below.

 

	5.	
Release.

 

		5.1.	
By signing this Agreement, effective as of the Closing, each Seller hereby waives, releases and absolutely and forever discharges the Purchaser and any and all of its shareholders, successors, assigns, affiliates, directors, employees (including officers), agents, advisors, consultants, auditors and attorneys, from and against any and all claims of every kind and nature whatsoever, whether now known or unknown, suspected or unsuspected, that have arisen or will arise in connection with his portion of the Warrants, the Warrant agreements and Section 2.1.2.4 of the SPA (except with respect to the obligations of the Purchaser pursuant to this Agreement).

 

	6.	
Conditions to Closing

 

		6.1.	
Conditions to Each Party’s Obligation to Consummate the Transaction. The respective obligation of each party hereto to consummate the Transaction is subject to the satisfaction or waiver of the following condition:

 

(a) No Injunction. No judgment, injunction or decree (each, an “Order”) prohibiting the consummation of the Transaction shall have been issued by any governmental entity and be continuing in effect, there shall be no pending proceeding commenced by a governmental entity seeking an Order that would prohibit the Transaction, and the consummation of the Transaction shall not have been prohibited or rendered illegal under any applicable law.

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		6.2.	
Conditions to the Sellers’ Obligation to Consummate the Transaction. The respective obligations of the Sellers to consummate the Transaction are subject to the satisfaction or waiver of each of the following conditions:

 

(a) Representations and Warranties. The representations and warranties of the Purchaser set forth in Section 4 shall be true and correct in all material respects as of the signing date of this Agreement and as of the Closing Date as if made on and as of the Closing Date.

 

(b) Covenants. Each of the covenants and agreements of the Purchaser contained in this Agreement that are to be performed at or prior to the Closing shall have been duly performed in all material respects.

		6.3.	
Conditions to the Purchaser’s Obligation to Consummate the Transaction. The obligation of the Purchaser to consummate the Transaction is subject to the satisfaction or waiver of each of the following conditions:

 

(a) Representations and Warranties. The representations and warranties of each Seller set forth in Section 3 shall be true and correct in all material respects as of the signing date of this Agreement and as of the Closing Date as if made on and as of the Closing Date.

 

(b) Covenants. Each of the covenants and agreements of each Seller contained in this Agreement that are to be performed at or prior to the Closing shall have been duly performed in all material respects.

 

(c) Court Approval. The competent courts in Israel shall have approved this Transaction and the payment of the Purchase Price to the Sellers hereunder as a "Distribution" as defined in the Companies Law, 1999.

 

	7.	
Termination.

 

		7.1.	
This Agreement may be terminated at any time prior to the Closing by the Purchaser or the Sellers (collectively as a group) if the Closing has not occurred before 5 p.m. Israel Time on the date which is five months following the date hereof or earlier if the competent courts in Israel shall have not approved the Transaction (provided, however, that the right to terminate this Agreement under this Section 7.1 shall not be available to any party hereto whose failure to fulfill any obligation hereunder has been the cause of, or resulted in, the failure of the Closing to occur on or before such date and provided further that Section 8 herein shall survive any termination of this Agreement).

 

	8.	
Miscellaneous.

 

		8.1.	
If this Agreement is terminated due to the fact that the competent courts in Israel shall have not approved this Transaction, the Company undertakes to take the required actions in order to maintain its current F-3 effective until the Warrants or the Ordinary Shares underlying such Warrants are sold by the Sellers.

 

		8.2.	
Each party shall bear its own costs and expenses related to this Agreement and the performance of its obligations hereunder, including all tax consequences.

 

		8.3.	
This Agreement, including the preamble and exhibit thereto, constitutes the entire understanding and agreement between the parties with regard to the sale of Purchased Warrants, and supersedes, nullifies and terminates all prior agreements and representations between the parties with regard to such subject matter.

 

		8.4.	
The provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors, and administrators of the parties hereto. None of the rights, privileges or obligations set forth herein may be assigned or transferred without the prior consent in writing of the relevant Seller and Purchaser.

 

		8.5.	
No delay or omission to exercise any right, power, or remedy accruing to any party upon any breach or default under this Agreement, shall be deemed a waiver of any other breach or default theretofor or thereafter occurring. Any waiver, consent or approval of any kind on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing.

 

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		8.6.	
This Agreement shall be governed by and interpreted in accordance with the laws of the state of Israel, without giving effect to the rules respecting conflict of law, and the competent courts of Tel-Aviv shall have sole and exclusive jurisdiction over any dispute between the parties.

 

		8.7.	
All notices and other communications required or permitted hereunder to be given to a party to this Agreement shall be in writing and shall be faxed or mailed by registered, electronic or certified mail, postage prepaid, or prepaid air courier, or otherwise delivered by hand or by messenger, addressed to such party’s address as set forth in Exhibit I or at such other address as the party shall have furnished to each other party in writing in accordance with this provision. Any notice sent in accordance with this Section 8.7 shall be effective (i) if mailed, three (3) business days after mailing, (ii) if by courier one (1) business day after delivery to the courier service, (iii) if sent by messenger, upon delivery, and (iv) if sent via email or facsimile, upon transmission and electronic confirmation of receipt or (if transmitted and received on a non-business day or after recipient’s business hours) on the first business day following transmission and electronic confirmation of receipt (provided, however, that any notice of change of address shall only be valid upon receipt).

 

		8.8.	
This Agreement may not be amended except by a written and signed document executed by the Sellers and the Purchaser.

 

		8.9.	
If any provision of this Agreement is held invalid or unenforceable, such invalidity or unenforceability shall not affect other provisions of this Agreement, and, to that extent, the provisions of this Agreement are intended to be and shall be deemed severable.

 

[Signature page to follow]

 

5

 

IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of the day and year first hereinabove written.

 

Sellers

 

/s/ Bentsi Ben Atar

	
Bentsi Ben Atar

	 	
Iftah Bratspiess

 

 

	
Yosef Appleboum

	 	 

 

Purchaser

 

Magal Security Systems Ltd.

 

By: _________________________

 

Name::_______________________

 

Title: ________________________

 

6

Exhibit I

 

List of Sellers

 

	
Seller

	
Seller Contact Information

	
Total Number of Purchased Warrants

	
Purchase Price (US$)

	
Bank Account Details

	
Bentsi Ben Atar

	 	
279,401

	
$125,000

	 
	
Iftah Bratspiess

	 	
279,401

	
$125,000

	 
	
Yosef Appleboum

	 	
279,401

	
$125,000

	 
	
Total

	
838,203

	
$375,000

	 

 

Exhibit II

 

List of Warrant Agreements

 

		1)	
Warrant dated January 21, 2012 granted to the Trustee (on behalf of Bentsi Ben Atar) to purchase 149,701 Ordinary Shares, exercisable until December 30, 2018.

 

		2)	
Warrant dated January 21, 2012 granted to the Trustee (on behalf of Bentsi Ben Atar) to purchase 149,700 Ordinary Shares, exercisable until December 30, 2019.

 

		3)	
Warrant dated January 21, 2012 granted to the Trustee (on behalf of Iftah Bratspiess) to purchase 149,701 Ordinary Shares, exercisable until December 30, 2018.

 

		4)	
Warrant dated January 21, 2012 granted to the Trustee (on behalf of Iftah Bratspiess) to purchase 149,700 Ordinary Shares, exercisable until December 30, 2019.

 

		5)	
Warrant dated January 21, 2012 granted to the Trustee (on behalf of Yosef Applebaum) to purchase 149,701 Ordinary Shares, exercisable until December 30, 2018.

 

		6)	
Warrant dated January 21, 2012 granted to the Trustee (on behalf of Yosef Applebaum) to purchase 149,700 Ordinary Shares, exercisable until December 30, 2019.alye_ex101.htm

EXHIBIT 10.1
  
 AMENDED AND RESTATED EMPLOYMENT AGREEMENT
  
 THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”), dated as of January 1, 2019 (“Effective Date”), is entered into by and between Aly Energy Services, Inc., (the “Employer”) and Greg Price (the “Executive”).
  
 WHEREAS, the parties have entered into an Employment Agreement, dated as of May 1, 2017 (the “Original Agreement”); and
  
 WHEREAS, the parties desire to amend and restate the Original Agreement as set forth herein;
  
 NOW, THEREFORE, the Employer and the Executive hereby agree as follows:
  
 1. Compensation and Employment. Executive agrees to continue employment with Employer, and Employer agrees to continue to employ Executive, on the terms and conditions set forth below. 
  
 (a) Duties of Executive. Executive's job title shall be the President and Chief Operating Officer of the Employer, and Executive’s responsibilities shall include such services commensurate with such title. Executive’s job duties will be principally located within the Houston, Texas metropolitan area.
  
 (b) Performance of Duties. Executive agrees during the Term (as defined hereinafter) of his/her employment, (i) he/she shall devote sufficient business time (at least 40 hours per week) and efforts, skills and abilities during business time exclusively to the performance of his/her duties as stated in this Agreement and to the furtherance of Employer's business, and (ii) he/she shall not be engaged in, or employed by, any other business enterprise without the written approval of the board of managers of Employer. Executive shall also use his/her best efforts to preserve the business of the Employer and the goodwill of all employees, customers, suppliers and other persons having business relations with the Employer. Notwithstanding the preceding, Executive may (i) advise, consult with and/or invest in businesses outside of the business or (ii) engage in the management of personal investments and in charitable service activities outside of the business so long as the foregoing do not materially detract from the performance of his/her duties hereunder or otherwise have a material adverse effect on Employer.
  
 (c) Base Salary. The Employer shall pay to Executive, and Executive agrees to accept for his/her employment by Employer, a base salary (the "Base Salary") which shall be $250,000, payable in installments by Employer in accordance with its payroll policies and subject to all appropriate withholdings.
  
 (d) Bonus Plan. Prior to January 1 of each year, Employer’s management will prepare a recommendation to the board of directors of targeted results of operations for such year, and the board will set proposed target results in a written bonus plan for such year. If 90% of Employer’s target results of operations for such year are achieved, Executive will receive a bonus equal to 40% of the Base Salary for such year; if 100% of target results of operations are achieved, Executive will receive a bonus equal to 50% of the Base Salary for such year; and if 110% or more of target results of operations are achieved, Executive will receive a bonus equal to 60% of the Base Salary for such year. Executive will also be eligible for a discretionary bonus ranging from 0% to 50% of Base Salary depending on the achievement of strategic objectives set in advance by the Employer’s CEO. The maximum total bonus that can be paid to Executive in any year is 110% of Base Salary.
   	 
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 (e) Option Grant. Pursuant to the Original Agreement, Executive received a fully vested grant of non-qualified stock options under Employer’s 2017 Stock Option Plan.
  
 (f) Benefits. Executive shall be entitled to participate in all employee benefits of the Employer as are generally afforded to other senior management employees of Employer.
  
 (g) Expense Reimbursement. Employer shall reimburse Executive for all business travel and other out-of-pocket expenses authorized by Employer and reasonably incurred by Executive in the performance of his/her duties hereunder during the Term. All reimbursable expenses shall be appropriately documented in reasonable detail by Executive upon submission of any request for reimbursement, and in a format and manner consistent with Employer's expense reporting policy applicable to executives of Employer at the level of Executive's position, as well as applicable federal and state tax record keeping requirements.
  
 (f) Vacation. Executive shall be entitled to 30 business days of vacation per calendar year of employment (which shall accrue ratably during each calendar year of employment). Accrued, untaken vacation days from one calendar year shall not carry over to the next succeeding calendar year of employment or be permitted to be paid in cash.
  
 2. Term. 
  
 (a) The term of this Agreement (the "Term") shall begin on the Effective Date and continue until the earliest of:
  
 (i) the 3rd day after Employer gives Executive written notice of his/her termination for "Cause" (as defined hereinafter),
  
 (ii) the date on which Employer terminates it for any reason other than for "Cause” or on which Executive terminates it for “Good Reason” (as defined hereinafter), provided that in such case, Employer shall pay Executive severance pay equal to (A) the Executive’s Base Salary for the “Severance Period” (as defined hereinafter), less (B) any amounts Employer is entitled to offset pursuant to subsection (c) below; and provided, further, that Employer shall also pay to Executive (when and if a bonus would otherwise have been paid pursuant to Section 1(d) above), the following portion of the bonus for the year in which the termination occurred: (A) if the termination occurred during the first six months of any bonus year, 50% of the bonus, or (B) if the termination occurred during the second six months of any bonus year, 100% of the bonus.
  
 (iii) the death or “total disability” (as defined hereinafter) of Executive; or
   	 
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 (iv) the date specified in Executive's written notice of his/her resignation for any reason.
  
 (b) For purposes of this Agreement:
  
 (i) “Severance Period” shall mean 12 months. 
  
 (ii) "Cause" for termination shall be limited to the following conduct of Executive: (a) has engaged in gross negligence, gross incompetence or willful misconduct in the performance of Executive’s duties with respect to Employer or any of its affiliates, (b) has refused without proper legal reason to perform Executive’s duties and responsibilities to Employer or any of its affiliates, (c) has breached any provision of Article VIII or any other provision of this Agreement, (d) has materially breached any provision of any written agreement or corporate policy or code of conduct established by Employer or any of its affiliates (and as amended from time to time), (e) has engaged in conduct that is materially injurious to Employer or any of its affiliates, (f) has disclosed, without specific authorization from Employer, confidential information of Employer or any of its affiliates that is injurious to any such entity, (g) has committed an act of theft, fraud, embezzlement, misappropriation or breach of a fiduciary duty to Employer or any of its affiliates or (h) has been convicted of (or pleaded no contest to) a crime involving fraud, dishonesty or moral turpitude or any felony, provided, however, that termination for Cause by Employer under any of clause (a) through (f) above shall not be permitted unless Employer has given the Executive at least thirty (30) days’ prior written notice that it has a basis for a termination for Cause, which notice shall specify the facts and circumstances constituting a basis for termination for Cause and Executive has not remedied such facts and circumstances constituting a basis for termination for Cause, to the extent possible, within such 30-day period. 
  
 (iii) “total disability” shall mean the certification by a reputable physician after examination of the Executive, of the Executive’s inability to substantially perform his/her duties pursuant to this Agreement as a result of a medical condition (other than a medical condition arising out of or attributable to the abuse of drugs and/or alcohol).
  
 (iv) “Good Reason” shall mean (a) the occurrence of a “Change of Control,” (b) the relocation of Executive to a location outside the Houston, Texas metropolitan area without Executive’s consent, (c) the material reduction by Employer in Executive’s Base Salary, responsibilities, duties, authority, title, compensation or reporting relationship without Executive’s consent or (d) Employer adversely affects Executive’s participation in or materially reduces Executive’s benefit under any benefit plan of Employer (including stock option and bonus arrangements) in which Executive is participating, without Executive’s consent.
  
 (v) “Change of Control” shall have the meaning set forth in Employer’s 2017 Stock Option Plan.
   	 
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 (c) In the event of any termination of Executive's employment under this Agreement for any reason, the Employer's obligation to make any payments hereunder shall be subject to offset for, among other items, any loans or other monetary obligations Executive has with the Employer which shall be deemed paid to the extent subtracted from the amount of payments due Executive. All payments and benefits payable under this Agreement are gross payments subject to applicable withholdings.
  
 (d) The Employer will pay to Executive the severance pay referenced above only upon the parties signing a mutual release that waives all claims that the Employer and Executive may have against the other, except (i) in regard to the enforcement of a party’s rights under this Agreement or (ii) in respect of actions or omissions of a party constituting gross negligence or willful misconduct.
  
 3. Trade Secrets and Confidential Information. 
  
 (a) For purposes of this section, "Confidential Information" means any data or information, other than Trade Secrets, that is valuable to the Employer, its direct or indirect subsidiaries, or its customers or prospective customers, and not generally known to the public or to competitors of the Employer. For purposes of this Agreement, "Trade Secret" means information including, but not limited to, any technical or non-technical data, formula, pattern, compilation, program, device, method, technique, drawing, process, financial data, financial plan, product plan, list of actual or potential customers or suppliers or other information similar to any of the foregoing, which (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can derive economic value from its disclosure or use and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
  
 (b) Executive acknowledges that by this Agreement, he/she shall be employed by the Employer in a confidential relationship wherein he, in the course of his/her employment with the Employer, will receive and will have access to Confidential Information and Trade Secrets of the Employer, including but not limited to confidential and secret business and marketing plans, strategies, and studies, detailed client/customer lists and information relating to the operations and business requirements of those clients/customers and, accordingly, he/she is willing to enter into the covenants contained in Sections 3 and 4 of this Agreement in order to provide the Employer with what he/she considers to be reasonable protection for his/her interests.
  
 (c) Executive hereby agrees that, during the Term and for an additional period of 12 months thereafter, he/she will hold in confidence all Confidential Information of the Employer, its direct or indirect subsidiaries, or its customers or prospective customers, that came into Executive's knowledge during his/her employment by the Employer and will not disclose, publish or make use of such Confidential Information without the prior written consent of the Employer.
  
 (d) Executive shall hold in confidence all Trade Secrets of the Employer, its direct or indirect subsidiaries, or its customers or prospective customers, that came into Executive's knowledge during his/her employment by the Employer and shall not disclose, publish or make use of at any time after the date hereof such Trade Secrets without the prior written consent of the Employer's board of managers for as long as the information remains a Trade Secret.
   	 
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 (e) Notwithstanding the foregoing, the provisions of this Section 3 will not apply to (i) information required to be disclosed by Executive in the ordinary course of his/her duties hereunder, (ii) Confidential Information that otherwise becomes generally known in the industry or to the public through no act of Executive or any person or entity acting on Executive's behalf, or which is required to be disclosed by court order or applicable law, or (iii) information independently developed by Executive without use or reference to any Confidential Information.
  
 (f) The parties agree that the restrictions contained in this Section 3 are in addition to and not in lieu of protections afforded to trade secrets and confidential information under applicable state law. Nothing in this Agreement is intended to or shall be interpreted as diminishing or otherwise limiting the Employer's right under applicable law to protect its Trade Secrets and Confidential Information.
  
 4. Return of Employer Property. All records, designs, patents, business plans, financial statements, manuals, memoranda, customer lists, customer databases, rolodexes and other property delivered to or compiled by Executive for or on behalf of the Employer or its representatives, vendors or customers that pertain to the Business of the Employer (including the respective subsidiaries thereof) shall be and remain the property of the Employer, and be subject at all times to its discretion and control. Upon the request of the Employer and, in any event, upon the termination of Executive's employment with the Employer, Executive shall deliver all such materials to the Employer. Likewise, all correspondence, reports, records, charts, advertising materials and other similar data pertaining to the business, activities or future plans of the Employer that are collected by Executive shall be delivered promptly to the Employer without request by it upon termination of Executive's employment.
  
 5. Compliance with Section 409A of the Code. Each payment under this Agreement, including each payment in a series of installment payments, is intended to be a separate payment for purposes of Treas. Reg. § 1.409A-2(b), and is intended to be: (i) exempt from Section 409A of the Internal Revenue Code of 1986, the regulations and other binding guidance promulgated thereunder (“Section 409A”) or (ii) in compliance with Section 409A; and the provisions of this Agreement will be administered, interpreted and construed accordingly. Notwithstanding the foregoing provisions of this Agreement, if the payment of any severance compensation or severance benefits under Article VII would be subject to additional taxes and interest under Section 409A, then any such payments that Executive would otherwise be entitled to during the first six months following Executive’s separation from service shall be accumulated and paid on the date that is six months after Executive’s separation from service (or if such payment date does not fall on a business day of Employer, the next following business day of Employer), or such earlier date upon which such amount can be paid under Section 409A without being subject to such additional taxes and interest.
  
 6. Entire Agreement. This Agreement supersedes any and all other agreements, either oral or written, between the parties hereto with respect to the subject matter hereof and contains all of the covenants and agreements between the parties with respect thereto. 
   	 
	5
	 
 
	 

  
 7. Modification. No change or modification of this Agreement shall be valid or binding upon the parties hereto, nor shall any waiver of any term or condition in the future be so binding, unless such change or modification or waiver shall be in writing and signed by the parties hereto. 
  
 8. Governing Law and Venue. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Texas (excluding conflicts of law principles). If any action is brought to enforce or interpret this Agreement, venue for such action shall be in the state courts of Texas. 
  
 9. Attorney's Fees. If any action, proceeding, or litigation is brought under or with respect to this Agreement, the prevailing party shall be entitled to his/her costs and expenses incurred in relation thereto, including reasonable attorneys' fees.
  
 10. Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which shall constitute one document. 
  
 11. Estate. If Executive dies prior to the expiration of the Term of employment, any monies that may be due him/her from Employer under this Agreement as of the date of his/her death shall be paid to his/her estate. 
  
 12. Assignment. Employer shall have the right to assign this Agreement to its successors or assigns. Employer further covenants to cause any such successor or assign to assume the terms and conditions of this Agreement. The terms "successors" and "assigns" shall include any person, corporation, partnership or other entity that buys all or substantially all of Employer's assets or all of its stock, or with which Employer merges or consolidates. The rights, duties and benefits to Executive hereunder are personal to him/her. Accordingly, no such right or benefit may be assigned by him/her, and no other person shall have any rights therein. 
  
 13. Binding Effect. This Agreement shall be binding upon the parties hereto, together with their respective executors, administrators, successors, personal representatives, heirs and assigns. 
  
 14. Waiver of Breach. The waiver by any party of a breach of any provision of this Agreement by the other party shall not operate or be construed as a waiver of any subsequent breach by the breaching party.
   	 
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 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year first above written.
   	 	 Aly Energy Services, Inc.
	
	 	 	 	 
	 	By:	/s/ MICKI HIDAYATALLAH	
	  
	  
	Micki Hidayatallah	 
	 	 	Chief Executive Officer	 
	 	 	 	 
	  
	 EXECUTIVE:
	  

	  
	  
	  
	  

	  
	 By:
	 /s/ GREG PRICE
	  

	  
	  
	 Greg Price
	  

  
  	 
	7

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