Danny Montgomery

About Danny Montgomery

Danny Montgomery, age 76, is Senior Vice President of Alpha ProTech Engineered Products, Inc. (since 2005), Senior Vice President of Manufacturing (since 2007), and has served on APT’s Board of Directors since 2007; he joined the company in 1994 when APT acquired assets of Ludan Corp., which he founded and managed . He is an employee-director and not independent under NYSE American standards due to his employment with the company . Company performance context during his recent tenure: Pay-versus-performance disclosure shows Net Income of $3.9M in 2024, $4.2M in 2023, and $3.3M in 2022, and a $100 initial investment TSR value of $88.61 (2024), $47.44 (2023), and $36.05 (2022) .

Past Roles

External Roles

No external public company directorships or committee roles are disclosed for Montgomery in the company’s proxy materials .

Board Governance

• Board service: Director since 2007; continues as a director-nominee in 2025 .
• Committee roles: Current committee memberships are Audit (Shaw, Garcia, Ritota), Compensation (Ritota, Buchan, Garcia), and Nominating/Governance (Buchan, Garcia, Shaw); Montgomery is not listed on any committee .
• Independence: Not independent due to employment with APT, per NYSE American standards; four non-employee directors are independent and populate all three committees .
• Dual-role implications: As an employee-director, he participates in board oversight while holding senior operating roles; independence concerns are mitigated by fully independent committee membership and majority independent board composition .

Fixed Compensation

Notes:

• 401(k) plan: APT matches 25% of the deferral up to 1% of compensation; NEOs participate on same terms as employees; company’s only 2024 contribution to any NEO was $2,704 to Montgomery .
• Pension/SERP: No pension or defined benefit plans for NEOs; perquisites are limited (e.g., car insurance, corporate condominium use noted for other NEOs; Montgomery’s “All Other” reflects 401(k) match) .

Performance Compensation

Option Exercises

Equity Ownership & Alignment

Beneficial Ownership (latest and prior year)

Outstanding/Unvested Awards

Policies and Alignment

• Insider trading, anti-hedging/pledging: Directors and officers are prohibited from hedging, monetization transactions and similar arrangements; policy titled “Prohibition on Pledging and Hedging of Company Stock” applies to directors and officers .
• Equity plan change-in-control: Upon a change in control, all outstanding options and SARs become fully exercisable; restricted periods expire for RS/RSUs; performance periods end with committee determination per plan .
• Stock ownership guidelines: Not disclosed for executives or directors in the proxy; employee-directors receive no additional pay for board service .

Employment Terms

Director Compensation (for context)

Employee-directors receive no additional compensation for Board service; non-employee directors received a $30,000 annual retainer, committee chair fees ($1,000 for Compensation/Nominating; $11,000 for Audit), and RSU grants of 4,740 units vesting in one year on 9/30/2024; Montgomery is excluded from the director compensation table as an employee .

Shareholder Feedback (Say-on-Pay and Elections)

• 2025 Annual Meeting results: Montgomery received 5,167,632 votes for, 101,053 withheld; broker non-votes 2,400,804 .
• Say-on-Pay (2025): 4,943,416 For; 289,976 Against; 35,293 Abstain; broker non-votes 2,400,804 .
• Say-on-Frequency (2025): Shareholders chose “Every Year” (5,033,465 votes) .

Compensation Structure Analysis

• Cash vs equity mix: Montgomery’s pay is predominantly salary and discretionary cash bonus; no option grants in 2023–2024; a single time-based RSU award in 2023 (35,000 units) .
• Shift from options to RSUs: Company moved from legacy option plan to 2020 Omnibus Incentive Plan; RSUs in 2023 with three-year time-based vesting represent lower-risk equity vs options; no option grants in 2023–2024 .
• Performance metrics: Bonuses are discretionary; proxy does not disclose formal quantitative targets for Montgomery; RSUs time-based, not performance-based .
• Repricing/modification: No option repricing disclosed; plan prohibits below-fair-market exercise prices .

Risk Indicators & Red Flags

• Hedging/pledging: Prohibited for directors/officers (reduces misalignment risk) .
• Related party transactions, legal proceedings: Not disclosed for Montgomery in reviewed materials.
• Equity award acceleration: RSUs/options accelerate upon change in control, potentially increasing event-driven payout risk .
• Insider selling pressure: Option exercises in 2023 and 2024 indicate monetization of legacy options; upcoming RSU vesting in 2026 could be a liquidity event .

Investment Implications

• Alignment: Montgomery’s substantial tenure and operational expertise support continuity; equity alignment exists via unvested RSUs and share ownership, with anti-hedging/pledging policy reinforcing long exposure .
• Pay-for-performance: Discretionary bonus structure without disclosed targets and time-based RSUs reduce direct linkage to financial metrics, placing greater weight on committee judgment; however, company-level pay-versus-performance data and majority-independent committee oversight partially address governance concerns .
• Retention and selling pressure: The 35,000 RSUs vest on the third anniversary of the 9/28/2023 grant, creating a 2026 vesting event; historical option exercises suggest potential periodic liquidity, but no pledging/hedging permitted .
• Dual-role governance: As an employee-director, Montgomery is not independent, but independent committees and majority-independent board mitigate oversight risks; no committee roles for Montgomery reduce conflicts in compensation or audit oversight .