Exhibit 10.1

SEPARATION AGREEMENT AND GENERAL RELEASE

THIS SEPARATION AGREEMENT AND GENERAL RELEASE (“Agreement”) is made between
Shane Waslaski (“you”) and Otter Tail Corporation (“Employer”). Your employment
with Employer ends effective May 15, 2014. As part of this Agreement, Employer
has agreed to provide you with certain benefits to which you would not be
entitled absent your signing of this Agreement.

In consideration of the mutual promises contained in this Agreement, you and
Employer agree as follows:

1. Separation from Employment. You will resign your employment and will be
relieved of all employment related duties effective May 15, 2014.

2. Payment. In connection with your separation from employment, Employer will
pay to you, Six Hundred Fifteen Thousand and no/100 ($615,000.00), in one lump
sum, (“Separation Payment”). This Separation Payment will be subject to required
deductions for tax withholding, and will be paid with the regular payroll after
you have signed the Agreement and the period for rescission, if any, has
expired, provided you have not rescinded this Agreement.

If you choose to continue your health insurance benefits pursuant to the federal
COBRA law, Employer will reimburse you for the total cost of such coverage
through December 31, 2014.

You acknowledge that you shall not receive any other compensation from Employer,
including bonus/incentive compensation payments, employer contributions to any
401(k) or other retirement plans, and employer-sponsored benefits (excluding the
above mentioned health insurance benefits and those other benefits which you
elect to maintain at your expense through COBRA).

3. Release. In consideration of the payment set forth in paragraph 2 of this
Agreement, the sufficiency of which is hereby acknowledged, you, on your behalf
and on behalf of your agents, representatives, attorneys, assigns, heirs,
executors, family members, beneficiaries, administrators, successors, and anyone
acting, or claiming to act on your behalf, hereby absolutely and unconditionally
releases and forever discharges Employer and its past, present and future
employees, agents, owners, partners, insurers, officials, officers, directors,
shareholders, board members, representatives, divisions, parents, subsidiaries,
successors, and all affiliated organizations, companies, foundations and
corporations from any and all claims, complaints, charges and causes of action
of any type, whether known or unknown, asserted or unasserted, direct and
indirect, and of any kind, nature or description whatsoever, under any local,
state or federal law or ordinance, or under the common law, arising or which may
have arisen at any time prior to the date of this Agreement. You specifically
agree that in consideration of the payment as set forth in paragraph 2, of this
Agreement, to release any and all claims with regard to any rights you may have
associated with your Otter Tail Corporation Executive

--------------------------------------------------------------------------------

Employment Agreement Amended Effective January 1, 2013, and any of its
predecessors as well as any and all rights associated with the Change in Control
Severance Agreement with Employer dated February 24, 2012. The agreed-upon
consideration has been negotiated and bargained for all things above mentioned,
and received in full satisfaction for the above.

You understand that by releasing all of your legal claims against Employer, you
are releasing all of your rights to bring any claims against it based on any
actions, decisions, or events occurring through the date of this Agreement,
including claims related to the terms and conditions of your employment and
separation from employment.

Your release includes any and all claims based upon federal, state or local
employment discrimination or wage and hour laws, regulations or ordinances,
including but not limited to the Age Discrimination in Employment Act, the Older
Workers Benefit Protection Act, Title VII of the Civil Rights Act, the Americans
with Disabilities Act, the North Dakota Human Rights Act; claims for breach of
contract, quasi-contract or promissory estoppel; any tort, including
misrepresentation, fraud infliction of emotional distress, defamation, assault,
battery, tortuous interference with prospective relations, false imprisonment,
negligence (including negligent hiring, supervision and retention); claims of
unlawful discharge or in any other respect unfairly treated during his
employment with Employer; and any and all claims in and arising out of your
employment with Employer.

Nothing herein shall be construed to prohibit you from filing a charge with the
Equal Employment Opportunity Commission (“EEOC”) or state Department of Labor.
However, your release includes release of your right to file a court action or
to seek individual remedies or damages in any EEOC claim (state or federal), and
your release of these rights shall apply with full force and effect to any
proceeding arising from or relating to such charge. This Agreement prohibits
your ability to pursue any claims against the released parties seeking monetary
relief or other remedies for yourself or as a representative on behalf of
others. You agree that you will not seek, accept, be entitled to any monetary
relief, whether for yourself individually or as a member of a class or group
arising from an EEOC charge filed by you or on your behalf.

4. Cooperation. Between now and May 15, 2014, you will fully cooperate with
Employer and will use your best efforts to ensure the orderly transition of your
duties and responsibilities. As part of that process, among other things, you
will provide Employer with your assessment of each of your direct reports, their
present work and 2014 goals, and discussions you have had with them regarding
incentive compensation. You will provide us with your present assessment of each
of the Varistar operating companies, their strengths and weaknesses, the issues
that should be addressed in the near term, and important contacts. Finally, you
will provide Employer with an update of the status of your Varistar initiatives,
items that need immediate attention, and plans for the future.

5. Return of Employer’s Property. You represent and warrant that you have
returned to Employer all company property including but not limited to all files
(whether paper or electronic), company information or business records,
electronic data, any intellectual property, all items created by you while an
employee of Employer and any equipment, machinery, keys, files, computer
hardware and software, mobile phone, pagers, or other assets of company.

 

2

--------------------------------------------------------------------------------

6. Non-Disparagement. You and the Employer’s Executive Team agree to refrain
from making any statements or communications which in any way are negative or
disparaging to one another.

7. Confidential Information. You acknowledge that during your employment with
Employer you received Confidential Information, the value of which depends on it
remaining confidential. You agree that you will not disclose or use any
Confidential Information of Employer. You confirm that you do not have in your
possession any tangible, written, graphical, electronic, machine readable or
other materials containing or disclosing Confidential Information. For purposes
of this paragraph, “Confidential Information” means any information that derives
independent economic value, actual or potential, from not being generally known
to the public or to other persons who can obtain economic value from its
disclosure or use and includes information of Employer, its customers,
suppliers, joint ventures, licensors, distributors and other person and entities
with whom Employer does business.

8. Non-Solicitation: For a period of twelve (12) months, you agree not to
directly or indirectly engage, hire or offer to hire or entice away or in any
manner persuade or attempt to persuade any officer, employee, agent,
shareholder, producing agent, client, vendor, or customer of Employer to
discontinue or otherwise materially adversely alter the terms of the
relationship with the Employer.

9. Damages. Any material and willful breach or non-fulfillment of conditions set
forth above will be considered a substantial breach of this Agreement by you if
demonstrably injurious to the Employer. If there is such a breach, Employer may,
at its option, terminate this Agreement immediately. In addition, it is agreed
that Employer may be substantially damaged by breach of the above conditions and
upon showing of adverse impact, you will pay to employer a sum up to and
including the entire amount reflected in paragraph 2 above.

10. Compliance Certification. You represent and warrant that you have fully and
accurately disclosed to George Koeck, Otter Tail Corporation General Counsel,
any practice, act, or omission that violates or likely violates the Otter Tail
Corporation and Employer Code of Conduct, and/or any state or federal law.

11. No Admission. This Agreement is not an admission by Employer that it has
acted wrongfully toward you or anyone else, and shall not be interpreted as
such.

12. No Assignment. This Agreement is personal to you and may not be assigned by
you. The payment to be provided to you shall be made to your estate in the event
of your death prior to your receipt thereof.

13. Governing Law; Severability. This Agreement shall be governed by the laws of
the State of North Dakota. If any part of this Agreement is construed to be in
violation of any law, such part shall be modified to achieve the objective of
the parties to the fullest extent permitted and the balance of this Agreement
shall remain in full force and effect.

 

3

--------------------------------------------------------------------------------

14. Entire Agreement. You agree that this Agreement contains the entire
agreement between you and Employer with respect to your separation from
employment and that there are no promises or understandings outside of this
Agreement with respect to your separation. Any modification of or addition to
this Agreement must be in a writing signed by you and Employer.

15. ACKNOWLEDGMENT. YOU AFFIRM THAT YOU HAVE READ THIS AGREEMENT. YOU
ACKNOWLEDGE THAT YOU HAVE HAD AN OPPORTUNITY TO CONSULT WITH AN ATTORNEY PRIOR
TO SIGNING THIS AGREEMENT. YOU AGREE THAT THE PROVISIONS OF THIS AGREEMENT ARE
UNDERSTANDABLE TO YOU AND THAT YOU HAVE ENTERED INTO THIS AGREEMENT FREELY AND
VOLUNTARILY.

IN WITNESS WHEREOF, the parties have executed this Agreement by their signatures
below.

 

Dated: May 8, 2014   /s/ Shane Waslaski   Shane Waslaski Dated: May 8, 2014  
/s/ Edward J. McIntyre   Edward J. McIntyre   CEO

 

4