Exhibit 10.1
Monday, September 18, 2006
Glenn Kermes
713 5th Avenue South
Escanaba, MI 49829
Dear Glenn:
On behalf of Winland Electronics, Inc., I am pleased to offer you an opportunity
to join our organization as a Chief Financial Officer, reporting to Lorin
Krueger, President/CEO. Presuming you accept our offer, we would like you to
begin on October 2, 2006.
Your starting annual salary will be $135,000.00, paid bi-weekly at a rate of
$5,192.31. The Chief Financial Officer position is classified as an “Exempt”
position, and therefore, not eligible for overtime compensation. Based on the
achievement of pre-determined goals (to be mutually agreed upon by you and the
CEO and completed or satisfied by Dec. 31, 2006), you will be eligible to earn
up to an additional $10,000 gross incentive. You will also be eligible for an
additional incentive of up to 20% of your base salary, based upon the company
meeting Board of Directors’ approved performance guidelines. This incentive is
not guaranteed and must be released by both the Board of Directors and the
President/CEO, with exact award amount determined by the President/CEO. As an
officer, you will also be awarded 36,000 stock option shares, with the strike
price in effect on your first day of employment (Oct. 2, 2006). These options
will vest at 20% per year to be fully vested in five years.
A relocation package (including up to one month’s temporary housing in the
Mankato area) will be provided for reasonable relocation expenses by a moving
company pre-approved by Winland Electronics. All moving expenses must be
approved by the CEO prior to the move. Please see the attached Relocation
Package Agreement for details.
Your initial Paid Time Off (PTO) accrual will be at the rate of 10.667 hours per
month, which will be prorated for the remainder of this year. Additional
benefits under Winland’s Employee Benefit Program are described in the enclosed
Benefits Summary.
If you are to accept employment at Winland Electronics, Inc., it shall be in an
“at-will” capacity, meaning that either the employee or the Company may
terminate the relationship at any time with the understanding that neither party
has the obligation to base the decision on any reason other than intent not to
continue the employment relationship.
This offer of employment is contingent upon the successful completion of
Winland’s pre-employment drug screening process. Please see the attached Drug
and Alcohol Testing Policy. Acceptance of all terms outlined in the Employment
Agreement is also required as a part of this offer; the agreement will be
approved by the Compensation Committee and presented to you. This agreement will
have the

 

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standard non-competition and intellectual property clauses. A basic draft is
attached; note, this is not the final agreement being offered.
Please return this letter, signed drug policy acknowledgements and employment
agreement on or before Tuesday, September 26, 2006 to indicate your acceptance
and understanding.
If you have questions about the position or our benefits package, please contact
me at 507-386-4170. We look forward to having you as part of the Winland team!
Sincerely,

          /s/ Holly Jones
 
Holly Jones, SPHR
Human Resources Manager
Winland Electronics, Inc.
hejones@winland.com
507-386-4170   /s/ Glenn Kermes
 
Acceptance Signature   September 26, 2006
 
Date

Enc.
Relocation Package Agreement
Drug and Alcohol Testing Policy
Employment Agreement, Non-Competition & Confidentiality Agreement

 

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Winland Electronics, Inc.
Relocation Package Agreement

       
Employee:
  Glenn Kermes
 
   
 
   
Start Date:
  October 2, 2006
 
   

A relocation package of approximately $9,000 (net) will be paid directly to the
pre-approved providers listed below. Payment will be made once move is complete.
Expenses listed are an estimate; final cost will be determined upon completion
of service. All moving expenses must be pre-approved by the President/CEO.
Relocation Expenses:

  •   Up to One Month Stay at Grandstay Executive Suites, Mankato $1737     •  
Full service moving expenses, Mayflower Corporation, estimated $7,000

If the employee voluntarily leaves Winland Electronics, Inc. before completing
one year of service, he/she may be subject to reimbursing Winland Electronics,
Inc. for a pro-rated amount of the relocation payment.
Winland Electronics, Inc. may elect to net any reimbursement due against
undistributed funds owed to the employee upon termination.
The employee’s signature below is:

  •   Confirmation of understanding of this agreement.     •   Authorization to
deduct these funds.

       
Signature:
   
 
   
 
   
Date: