Lloyd Hoffman
ALPHA PRO TECHAbout Lloyd Hoffman
Lloyd Hoffman (age 64) is President, Chief Executive Officer, and Director of Alpha Pro Tech, Ltd. He has been employed by the company since 1991, serving as SVP Finance & Administration (1999–2002), CFO (2002–Dec 2015), CEO (Jan 2016–present), and President (Dec 2017–present); he has been a director since January 2016 . Pay-versus-performance disclosures show cumulative TSR values based on a $100 initial investment of $36.05 (2022), $47.44 (2023), and $88.61 (2024), with net income of $3.3M (2022), $4.2M (2023), and $3.9M (2024) . Hoffman beneficially owns 183,220 shares, or 1.7% of outstanding shares as of April 14, 2025 .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Alpha Pro Tech, Ltd. | Accountant | 1991–1999 | Foundation finance roles supporting scale-up |
| Alpha Pro Tech, Ltd. | SVP Finance & Administration | 1999–2002 | Led finance/admin through growth phase |
| Alpha Pro Tech, Ltd. | Chief Financial Officer | 2002–Dec 2015 | Stewarded public-company finance and controls |
| Alpha Pro Tech, Ltd. | Chief Executive Officer | Jan 2016–present | Overall strategy and execution |
| Alpha Pro Tech, Ltd. | President | Dec 2017–present | Day-to-day operations and leadership |
| Alpha Pro Tech, Ltd. | Director | Jan 2016–present | Board governance and oversight |
External Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Software Concepts, Inc. | Head of Finance & Administration | 1987–1991 | Financial and administrative leadership for software publisher |
Fixed Compensation
| Metric ($) | FY 2023 | FY 2024 |
|---|---|---|
| Base salary | 657,000 | 657,000 |
| Cash bonus (contractual/discretionary) | 286,000 | 264,000 |
| Stock awards (RSU grant-date FV) | 211,500 | 57,150 |
| Option awards | — | — |
| All other compensation | — | 9,026 |
| Total | 1,154,500 | 987,176 |
- Perquisites in 2024: $2,692 car insurance and $6,334 personal use of corporate condominium .
- No stock options granted in 2023 or 2024 .
Performance Compensation
| Component | Metric link | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|---|
| Contractual incentive bonus | 5% of earnings before tax (EBT), capped at $1,000,000 | N/A | Up to 5% EBT (cap $1M) | Not disclosed (bonus paid $264,000 for 2024) | $264,000 (2024) | Cash (paid soon after determination) |
| RSU grant (2024) | Time-based vest | N/A | 10,715 RSUs | Granted Jan 8, 2024 | Grant-date FV $57,004 / SCT $57,150 | Vests on first anniversary of grant date |
| RSU grant (2023) | Time-based vest | N/A | 50,000 RSUs | Granted Sept 28, 2023 | Grant-date FV included in SCT $211,500 (2023) | Vests on third anniversary of grant date |
Option history and execution:
- 2016 option grant: 200,000 options at $2.12, five-year life, vest in equal installments over three years; Hoffman held 66,667 exercisable and 133,333 unexercisable at 12/31/2017, expiring 6/23/2021 .
- 2018 option grant: 95,000 options at $3.20, grant-date FV $146,300 .
- 2024 exercises: 100,000 shares exercised; value realized $203,000 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 183,220 shares, 1.7% of class (10,864,002 shares outstanding) as of April 14, 2025 |
| Unvested RSUs | 50,000 granted 9/28/2023 (vest on third anniversary); market value $264,500 at $5.29 close on 12/31/2024 |
| Unvested RSUs | 10,715 granted 1/8/2024 (vest on first anniversary); market value $56,682 at $5.29 close on 12/31/2024 |
| Options outstanding (12/31/2024) | None (no unexercised options reported) |
| Hedging/pledging policy | Company prohibits hedging and monetization transactions for directors/officers; policy filed with 2024 10-K |
Vesting schedule signals:
- 10,715 RSUs scheduled to vest on Jan 8, 2025 (first anniversary) .
- 50,000 RSUs scheduled to vest on Sept 28, 2026 (third anniversary) .
Employment Terms
| Provision | Terms |
|---|---|
| Agreement and term | Employment agreement effective Aug 31, 2016; continued through Jan 1, 2021, thereafter auto-renews annually unless notice |
| Base salary | Subject to Compensation Committee increases; historical increases: $600,000 effective Jul 1, 2017; $618,000 Jan 1, 2018; $632,000 Jan 1, 2019 |
| Contractual bonus | 5% of EBT (as presented in annual income statement), capped at $1,000,000 |
| Termination for cause | Accrued base salary and benefits only |
| Termination without cause | Accrued amounts plus termination payment: (base salary ÷ 12) × years of service; paid in installments |
| Change of control (CoC) | If terminated in connection with CoC or thereafter, payment: (base salary ÷ 12) × years of service; paid in lump sum |
| Retirement (not disabled) | Continue services as consultant/representative for 4 years; paid 40% of base salary in effect at retirement |
| Death/Disability | Accrued amounts plus payment: (base salary ÷ 24) × years of service |
| Restrictive covenants | Non-compete and non-solicitation for two years post-termination; general release required for severance/CoC payments |
Board Governance
- Board service: Director since Jan 2016; CEO since Jan 2016; President since Dec 2017; the company notes Hoffman has performed Chairman duties since Dec 2017 without formal appointment, and the board periodically evaluates leadership structure .
- Independence and leadership: Four of seven directors are independent; all three key committees (Audit, Compensation, Nominating/Governance) are fully independent; the board has not designated a Lead Independent Director; non-management directors meet in regular executive sessions .
- Attendance: In 2024, the board met four times, and each incumbent director attended at least 75% of meetings and applicable committee meetings; four directors attended the 2024 annual meeting .
- Committee compositions and chairs (2024):
- Audit: Benjamin A. Shaw (Chair), David R. Garcia, John Ritota; met four times; board determined all are independent and that Shaw is an “audit committee financial expert” .
- Compensation: John Ritota (Chair), James Buchan, David R. Garcia; met three times; committee independent, does not currently use an external compensation consultant but may engage one in future; reviewed company-wide comp plans for risk and concluded no material adverse risk likely .
- Nominating/Governance: Standing committee; charter available on website; oversees board composition and governance matters .
- Director compensation: Employees receive no additional pay for director service; non-employee directors receive annual retainer $30,000; Audit Chair +$11,000; Compensation and Nominating/Governance Chairs +$1,000; on Sept 30, 2024, each NED received 4,740 RSUs vesting in one year .
Director Compensation (Non-Employee Reference; Hoffman receives none as employee-director)
| Director | Cash fees ($) | Stock awards ($) | Total ($) |
|---|---|---|---|
| James Buchan | 31,000 | 27,018 | 58,018 |
| David R. Garcia | 30,000 | 27,018 | 57,018 |
| John Ritota | 31,000 | 27,018 | 58,018 |
| Benjamin A. Shaw | 41,000 | 27,018 | 68,018 |
| Donna Millar | — | — | — |
Note: Mr. Hoffman and Mr. Montgomery receive no additional director compensation as employees; their compensation is shown in the NEO table .
Compensation Structure Analysis
- Shift from options to RSUs: No options granted in 2023–2024; equity grants consisted of time-based RSUs; options were historically granted (2016, 2018) and exercised in 2024 .
- Cash vs equity mix: Stock awards declined year-over-year ($211,500 in 2023 to $57,150 in 2024), while salary remained flat at $657,000 and the contractual/discretionary bonus decreased modestly ($286,000 to $264,000) .
- Performance metric linkage: CEO’s contractual bonus formula ties pay directly to company EBT up to a $1,000,000 cap, aligning cash incentives with profitability .
- Say-on-Pay support: 94.4% approval at 2024 annual meeting, suggesting shareholder acceptance of pay design .
Say-On-Pay & Shareholder Feedback
- 2024 Say-on-Pay approval: 94.4% of votes cast supported NEO compensation; the Compensation Committee noted favorable support and did not take actions specifically in response to prior votes .
Performance & Track Record
| Indicator | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Value of $100 investment (TSR proxy metric) | 36.05 | 47.44 | 88.61 |
| Net income ($ millions) | 3.3 | 4.2 | 3.9 |
- Equity activity: 2024 option exercises of 100,000 shares with $203,000 value realized .
Risk Indicators & Red Flags
- Leadership concentration: CEO also performing Chairman duties since Dec 2017 without formal designation; no Lead Independent Director, though committees are independent and executive sessions are held .
- Hedging/monetization: Prohibited for directors and officers by insider trading policy (reduces misalignment risk from derivatives) .
- Equity award cadence: RSUs vesting on Jan 8, 2025 and Sept 28, 2026 could create near-term selling pressure upon vesting, depending on personal liquidity decisions; market values as of 12/31/2024 were $56,682 and $264,500, respectively .
Compensation Peer Group and Consultants
- The Compensation Committee does not currently use an external compensation consultant but retains authority to do so; compensation program is reviewed for risk and found not reasonably likely to have a material adverse effect .
Investment Implications
- Alignment: Hoffman’s contractual bonus directly links to profitability (EBT), and RSU grants create multi-year retention with upcoming vest dates Jan 2025 and Sept 2026; beneficial ownership of 1.7% provides meaningful but not controlling alignment .
- Retention and CoC economics: Auto-renewing contract, 2-year non-compete/non-solicit, and severance equal to (base ÷ 12 × years of service) with lump-sum under CoC termination provide stability but could increase exit costs in change-of-control scenarios .
- Governance balance: CEO performing Chairman duties raises concentration concerns mitigated by independent committee structures and regular executive sessions; shareholder support for pay (94.4%) suggests investors view current design as acceptable .
- Near-term trading signals: 2024 option exercise and 2025/2026 RSU vesting dates are potential catalysts for insider-related flows; monitor Form 4 filings around vesting windows for sell-to-cover or discretionary sales .