Exhibit 10.1







Exhibit 10.1



EMPLOYMENT AGREEMENT




THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into to be effective as of November 3, 2009 (the
“Effective Date”), between PEERLESS MFG. CO. (“Employer”), and Warren Hayslip (“Employee”).



Section 1. Employment.



1.1 Employment and Term. Subject to the terms and conditions of this Agreement, Employer agrees to employ
Employee as the Vice President and Chief Operating Officer of the Employer pursuant to this Agreement for a term
beginning on the Effective Date and ending on the second anniversary of this agreement, (the “Term”) unless Employee’s
employment is terminated earlier as provided in Section 4 below. Sections 2, 3, and 5
of this Agreement shall survive any termination of Employee’s employment with Employer.



1.2 Duties. At all times during the course of Employee’s employment with Employer, Employee agrees to
perform the duties associated with his position diligently and to devote all of his business time, attention and
efforts to the business of Employer. Employee agrees to comply with the policies, procedures and guidelines
established by Employer from time to time. Employee agrees to perform his duties faithfully and loyally and to the
best of his abilities, and shall use his best efforts to promote the business of Employer. Employee understands and
agrees that both the business and personal standards and ethics of Employer’s employees must at all times be above
reproach. Employee agrees to act at all times so as to reflect this high standard. Employee further agrees to abide by
all rules, policies, or procedures established by Employer from time to time. Subject to the approval of the Board of
Directors of PMFG, Inc. (the “Board”).



1.3 Supervision. Employee shall perform the duties of employment under the direction and supervision of
Employer’s Chief Executive Officer.



1.4 Compensation. During Employee’s employment, Employer will pay Employee a base annualized salary of
$220,000 (“Base Salary”), less all applicable withholding as required by law and/or voluntarily elected by Employee, to
be paid in installments in accordance with Employer’s standard payroll practice and schedule. The Employer may adjust
the Employee’s annualized salary from time to time at its sole discretion, but Employee’s Base Salary shall never be
reduced below $220,000 without his consent. Employer will provide Employee with Employee benefits generally made
available by Employer to other similarly situated employees, as per company policy. During Employee’s employment,
Employer shall reimburse Employee for all reasonable and necessary expenses incurred by Employee in furtherance of
Employer’s business interests upon appropriate documentation of such expenditures in accordance with Employer’s general
policy.



1.5 Bonus. Employee shall be eligible to participate in and receive bonuses according to such bonus
structure and plan as may be established or modified from time to time by the Employer on the same basis as other
similarly situated officers of the Employer.



1.6 Long Term Incentive. Subject to the discretion and approval of the Board, Employee may be awarded
stock awards in the form of options and/or restricted stock on an annual basis subject to the terms of the applicable incentive plan as such may be established or modified by the
Board from time to time.



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Section 2. Non-Competition.



2.1 Non Competition.


(a) In consideration of his employment under this Agreement and Employer’s agreement to provide Employee
with Confidential Information under Section 3 below, Employee agrees that during the term of his employment
and for a period of two (2) years following termination of his employment (regardless of whether Employee is
terminated without Cause, for Cause (as defined in Section 4.1(c) below), voluntarily resigns or
otherwise), neither Employee nor any person or entity directly or indirectly controlling, controlled by or
under common control with Employee, shall directly or indirectly, on his own behalf or as an employee or other
agent of or an investor in another person:




(i) engage in any business conducted by Employer during Employee’s term of employment with
Employer (collectively, the “Business”);




(ii) influence or attempt to influence any customer or supplier of Employer or any affiliate of
Employer to purchase goods or services related to the Business from any person other than Employer or
such affiliate; or




(iii) employ or attempt to employ any individuals who are then or have been employees of
Employer or any affiliate of Employer during the preceding 12 months, or influence or seek to
influence any such employees to leave Employer’s or such affiliate’s employment.




(b) Employee specifically acknowledges that Employer’s products are sold in a world market and that
Employee has been engaged with regard to Employer’s products and Employer’s customers throughout the world
without geographic limitation, and accordingly that the restrictive covenant regarding competition contained
in this Section 2.1 shall apply without geographic limitation.




(c) Employee acknowledges that his obligations under this Section 2.1 are a material inducement
and condition to Employer’s entering into this Agreement and a material inducement and condition to Employee
receiving or having access to Confidential Information (as defined in Section 3.1). Employee
acknowledges and agrees that the terms and provisions of this Agreement (including the severance provisions of
Section 4.1) and Employee’s receipt and access to Confidential Information are sufficient
consideration for the restrictions set forth in this Section 2.1. Employee acknowledges and agrees
further that such restrictions are reasonable as to time, geographic area and scope of activity and do not
impose a greater restraint than is necessary to protect the goodwill and other business interests of Employer,
and Employee agrees that Employer is justified in believing the foregoing.




(d) If any provision of this Section 2.1 should be found by any court of competent jurisdiction
to be unenforceable by reason of its being too broad as to the period of time, territory, and/or scope, then, and in that event, such provision shall nevertheless
remain valid and fully effective, but shall be considered to be amended so that the period of time, territory,
and/or scope set forth shall be changed to be the maximum period of time, the largest territory, and/or the
broadest scope, as the case may be, which would be found enforceable by such court



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(e) Employee acknowledges that Employee’s violation or attempted violation of this Section 2.1
will cause irreparable damage to Employer or its affiliates, and Employee therefore agrees that Employer shall
be entitled as a matter of right to an injunction, out of any court of competent jurisdiction, restraining any
violation or further violation of such agreements by Employee or others acting on his behalf. Employer’s
right to injunctive relief will be cumulative and in addition to any other remedies provided by law or equity.




(f) Employee shall not be subject to the provisions of this Section 2 if Employer fails to pay any
uncontested amounts due to Employee under Section 4 and such failure is not cured within thirty (30) days
after written notice to Employer.


Section 3. Confidentiality; Nondisparagement; Conflict of Interest.



3.1 Confidentiality.


(a) In the course of his employment with Employer, Employer shall provide Employee with access to
commercially valuable, confidential or proprietary information of the Employer (“Confidential Information”).
Confidential Information means all information, whether oral or written, previously or hereafter developed,
acquired or used by Employer and relating to the business of Employer that is not generally known to the
public or others in Employer’s area of business, including without limitation (i) any trade secrets, work
product, processes, analyses or know-how of Employer; (ii) Employer’s advertising, product development,
strategic and business plans and information, including customer and prospect lists; (iii) the prices at which
Employer has sold or offered to sell its products or services; and (iv) Employer’s internal financial
statements, budgets, cost information, pricing information and other financial information.




(b) Employee acknowledges and agrees that the Confidential Information is and shall be the sole and
exclusive property of Employer. Employee shall not use any Confidential Information for his own benefit or
disclose any Confidential Information to any third party (except in the course of performing his authorized
duties for Employer under this Agreement), either during or subsequent to his employment with Employer.




(c) Specifically, Employee agrees that, except as expressly authorized in writing by Employer, or as may
be required by law or court order, Employee shall (i) not disclose Confidential Information to any third
party, (ii) not copy Confidential Information for any reason, and (iii) not remove Confidential Information
from Employer’s premises. Upon termination of his employment with Employer, Employee shall promptly deliver
to the Employer all Confidential Information, including documents, computer disks and other computer storage
devices and other papers and materials (including all copies thereof in whatever form) containing or incorporating any Confidential
Information or otherwise relating in any way to the Employer’s business that are in his possession or under
his control.



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(d) Employee acknowledges that Employee’s violation or attempted violation of this Section 3.1
will cause irreparable damage to Employer or its affiliates, and Employee therefore agrees that Employer shall
be entitled as a matter of right to an injunction, out of any court of competent jurisdiction, restraining any
violation or further violation of such agreements by Employee or others acting on his behalf. Employer’s
right to injunctive relief will be cumulative and in addition to any other remedies provided by law or equity.



3.2. Covenant of Nondisparagement. In consideration of this Agreement, Employee agrees and promises that,
during the Term and at all times after the termination of this Agreement (regardless of whether Employee is terminated
without Cause, for Cause, voluntarily resigns or otherwise), not to make any libelous, disparaging or otherwise
injurious statements about or concerning Employer or any of its affiliates, their officers, employees or
representatives. Such prohibited statements include any statement that is injurious to the business or business
reputation of any of Employer, its affiliates or their employees or representatives, but does not include reasonable
statements of disagreement that Employee makes for the purpose of protecting or enforcing any of his rights or
interests hereunder or defending against any claim or claims of Employer, so long as such statements are not slanderous
or libelous and are delivered in terms as would ordinarily be considered customary and appropriate.



3.3. Conflict of Interest. Employee agrees that during the Term, without the prior approval of the Board,
Employee shall not engage, either directly or indirectly, in any activity which may involve a conflict of interest with
Employer or its affiliates (a “Conflict of Interest”), including ownership in any supplier, contractor, subcontractor,
customer or other entity with which Employer does business (other than as a shareholder of less than one percent of a
publicly traded class of securities) or accept any material payment, service, loan, gift, trip, entertainment or other
favor from a supplier, contractor, subcontractor, customer or other entity with which Employer does business and that
Employee shall promptly inform the Board as to each offer received by Employee to engage in any such activity.
Employee further agrees to disclose to Employer any other facts of which Employee becomes aware which might involve or
give rise to a Conflict of Interest or potential Conflict of Interest.




Section 4. Termination.



4.1 Termination by Employer.



(a) Employer may terminate Employee’s employment without Cause upon no less than 30 days prior notice of
termination to Employee. Employer shall pay the Severance Compensation (as defined in Section 5.1(h)) to
Employee after the effective date of such termination, except as otherwise provided by the terms of any stock
option or restricted stock agreement entered into with Employee during the Term.



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(b) Employer may discharge Employee for Cause at any time without prior notice. In the event of any such
termination for Cause, Employer’s obligations to pay any base salary, incentive compensation or bonus or
provide for any benefits to Employee shall terminate immediately upon the effective date of such termination,
except as otherwise provided by the terms of any stock option or restricted stock agreement entered into with
Employee during the Term.




(c) As used herein, “Cause” shall mean any of the following:




(i) the conviction of Employee by a court of competent jurisdiction of any felony or crime
involving moral turpitude;




(ii) commission by Employee of an act of fraud, dishonesty, slander, or other act reflecting
unfavorably upon the public image of Employer as reasonably determined by Chief Executive Officer;




(iii) the failure by Employee to substantially perform his duties hereunder, or any wrongdoing
by Employee resulting in injury to Employer, in each case as reasonably determined by Chief Executive
Officer;




(iv) the failure by Employee to follow a directive of the Chief Executive Officer or Board; or




(v) violation of any policies or procedures of Employer, including without limitation, any human
relations policy.



4.2 Termination by Employee. Employee may resign from Employee’s employment hereunder (whether for
voluntary retirement or otherwise) upon no less than 30 days prior notice of resignation to Employer, unless such prior
notice is otherwise waived by Employer in its absolute and sole discretion. The effective date of Employee’s
resignation shall be as stated in Employee’s notice of resignation or at the sole option of Employer, such earlier date
as determined by Employer in its sole discretion. If Employee voluntarily resigns from his employment with Employer
during the term hereof (whether for voluntary retirement or otherwise), Employer’s obligations to pay any base salary,
incentive compensation or bonus or provide for any benefits shall terminate immediately upon the effective date of such
resignation. Upon retirement, Employee shall be entitled to all benefits (if any) provided by Employer in the ordinary
course to other executive officers of Employer at comparable retirement age.



4.3 Termination on Death of Employee. This Agreement shall terminate automatically upon the death of
Employee and all rights of Employee, his heirs, executors and administrators to salary, bonus, incentive compensation
or benefits shall terminate immediately, except as otherwise provided in Employer’s benefit plans in effect at such
time.



4.4 Termination by Disability. Employer may terminate Employee’s employment hereunder upon Employee
becoming Disabled (as defined below). Upon such termination, Employer shall pay Employee an amount equal to his then
current monthly base salary for a period of six months, which payment amounts will be reduced by any disability
payments Employee receives during such period from the disability insurance provided through Employer, if any. Employee shall be entitled to all other disability benefits then in effect (if any) provided by Employer
to other similarly situated executive officers of Employer. In the event of termination due to Employee being
Disabled, except as aforesaid or as otherwise agreed to in writing by Employee and Employer, Employer shall have no
other obligation to pay any base salary, incentive compensation or bonus or provide for any benefits to Employee after
the effective date of termination. For purposes of this Section, “Disabled” means any mental or physical impairment
lasting (or that will last) more than 180 consecutive or non-consecutive calendar days that prevents Employee from
performing the essential functions of his position with or without reasonable accommodation as determined by a
competent physician chosen by Employer and consented to by Employee or his legal representatives, which consent will
not be unreasonably withheld or delayed. Employee agrees to submit to appropriate medical examinations and authorize
his physicians to release medical information necessary to determine whether Employee is Disabled for purposes of this
Agreement.



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Section 5. Termination.



5.1 Definitions. For Purposes of this Section 5, the following definitions apply.



	 	(a)	 	Acquiring Person. An “Acquiring Person” shall mean any person that, together with all
Affiliates and Associates of such person, is the beneficial owner of 50.1% or more of the outstanding
Common Stock of the Employer or its parent. The term “Acquiring Person” shall not include the Employer,
its parent, any subsidiary of the Employer, any employee benefit plan of the Employer (or trust with
respect thereto) or subsidiary of the Employer, or any person holding Common Stock of the Employer for or
pursuant to the terms of any such plan.






	 	(b)	 	Affiliate and Associate. “Affiliate” and “Associate” shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) in effect on the date of this Agreement.






	 	(c)	 	Cause. For “Cause” shall have the meaning set forth in Section 4.1(c) above.






	 	(d)	 	Change in Control. A “Change in Control” of the Employer or PMFG, Inc., shall have
occurred if at any time during the Term any of the following events shall occur:






	 	(i)	 	The Employer or PMFG, Inc., is merged, consolidated or reorganized into or
with another corporation or other legal person and as a result of such merger, consolidation or
reorganization less than 50.1% of the combined voting power to elect Directors of the then
outstanding securities of the remaining corporation or legal person or its ultimate parent
immediately after such transaction is available to be received by all stockholders on a pro rata
basis and is actually received in respect of or exchange for voting securities of the Employer
or PMFG, Inc. pursuant to such transaction;





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	 	(ii)	 	The Employer or PMFG, Inc. sells all or substantially all of its assets to
any other corporation or other legal person not controlled by or under common control with the
Employer or PMFG, Inc.;






	 	(iii)	 	Any person or group (including any “person” as such term is used in Section
13(d)(3) or Section 14(d)(2) of the Exchange Act has become the beneficial owner (as the term
“beneficial owner” is defined under Rule 13d-3 or any successor rule or regulation promulgated
under the Exchange Act) of securities which when added to any securities already owned by such
person would represent in the aggregate 50% or more of the then outstanding securities of the
Employer or PMFG, Inc., which are entitled to vote to elect Directors;






	 	(iv)	 	If at any time, the Continuing Directors then serving on the Board, cease for
any reason to constitute at least a majority thereof;






	 	(v)	 	Any occurrence that would be required to be reported in response to Item 6(e)
of Schedule 14A of Regulation 14A or any successor rule or regulation promulgated under the
Exchange Act; or






	 	(vi)	 	Such other events that cause a change in control of the Employer, as
determined by the Board in its sole discretion;






provided, however, a Change in Control of the Employer or PMFG, Inc. shall not be
deemed to have occurred as the result of any transaction having one or more of the foregoing effects
if such transaction is both (1) proposed by, and (2) includes a significant equity participation of,
executive officers of the Employer or PMFG, Inc. as constituted immediately prior to the occurrence
of such transaction or any Employer employee stock ownership plan or pension plan.




	 	(e)	 	Code. The “Code” shall mean the Internal Revenue Code of 1986, as amended.






	 	(f)	 	Continuing Director. A “Continuing Director” shall mean a member of the Board who (i)
is not an Acquiring Person, an Affiliate or Associate, a representative of an Acquiring Person or
nominated for election by an Acquiring Person, and (ii) was a member of the Board, on the date of this
Agreement or subsequently became a member of the Board of PMFG, Inc., and whose initial election or
initial nomination for election by the PMFG, Inc.’s stockholders was approved by a majority of the
Continuing Directors then on the Board.






	 	(g)	 	Disabled. “Disabled” shall have the meaning defined in Section 4.4 above.






	 	(h)	 	Severance Compensation. The “Severance Compensation” shall be:






	 	(i)	 	A lump sum amount equal to 75.0% of the Employee’s then current annualized
base salary in effect as of the date of the Termination;





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	 	(ii)	 	in any year in which Employee has been provided a bonus target under a bonus
plan adopted by the Board of PMFG, Inc., a pro rated bonus amount based upon the portion of the
year served by Employee, provided, however, such bonus amount shall be calculated and paid at
the time such bonuses are usually calculated by the Employer at year end; and






	 	(iii)	 	For a period of three (3) months, provide Employee with benefits
substantially similar to those which Employee was entitled to receive immediately prior to the
date of termination under all of the Employer’s “employee welfare benefit plans” within the
meaning of Section 3(1) of The Employee Retirement Income Security Act of 1974, as amended.






	 	(i)	 	Termination Date. The “Termination Date” shall be the effective date upon which the
Employer terminates the employment of Employee with the Employer within one year following a Change in
Control.





5.2. Rights of Employee Upon Change in Control and Subsequent Termination.




	 	(a)	 	The Employer shall provide Employee, within ten days following the Termination Date, Severance
Compensation, but without affecting the rights of Employee or the Employer at law or in equity, if,
within one year following the occurrence of a Change in Control, either of the following two events shall
occur:






	 	(1)	 	the Employer terminates Employee’s employment except for any of the following
reasons:






	 	(i)	 	Employee dies;






	 	(ii)	 	Employee becomes Disabled; or






	 	(iii)	 	The Employer terminates the Employee for Cause; or






	 	(2)	 	Employee terminates his employment after such Change in Control and the
occurrence of at least one of the following events:






	 	(i)	 	an material adverse change in the positions held by
Employee or a material diminution in the nature or scope of the authorities, functions
or duties attached to the positions with the Employer that Employee had immediately
prior to the Change in Control (provided however, a material adverse change or material
diminution shall not be deemed to have occurred simply because the parent of the
Employer has sold all or a substantial part of its interest in Employer, that Employer
becomes a subsidiary of another entity, or that Employee ceases to be a Vice President
of the Employer (PMFG, Inc.,), any reduction in Employee’s base salary (excluding bonus
and incentive compensation) during the Term or a material diminution in scope or value
of the aggregate other base benefits to which Employee was entitled from the Employer immediately prior to the Change in Control, any of which is not remedied
within ten calendar days after receipt by the Employer of written notice from
Employee of such change, reduction, alteration or termination, as the case may be;





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	 	(ii)	 	the relocation of the Employer’s principal executive
offices, or the requirement by the Employer that Employee have as his principal
location of work any location not within the greater Dallas, Texas metropolitan area or
that he/she travel away from his office in the course of discharging his duties
hereunder significantly more (in terms of either consecutive days or aggregate days in
any calendar year) than required of his prior to the Change in Control; or






	 	(iii)	 	the Employer commits any material breach of this
Agreement, which is not cured within ten calendar days after receipt by the Employer of
written notice from Employee of such breach.






	 	(b)	 	Upon written notice given by Employee to the Employer prior to the receipt of Severance
Compensation, Employee, at his sole option, may elect to have all or any part of any such amount paid to
them, without interest, on an installment basis selected by them.






	 	(c)	 	The payment of Severance Compensation by the Employer to Employee shall not affect any rights
and benefits which Employee may have pursuant to any other agreement, policy, plan, program or
arrangement with the Employer prior to the Termination Date, which rights shall be governed by the terms
thereof, except that payments hereunder after termination under this Section 5 shall reduce by an equal
amount any sums payable after termination of employment under Section 4.1(a) above, as may be amended,
restated or modified.





5.3 No Mitigation Required. In the event that this Agreement or the employment of Employee hereunder is
terminated, Employee shall not be obligated to mitigate his damages nor the amount of any payment provided for in this
Agreement by seeking other employment or otherwise, and the acceptance of employment elsewhere after termination shall
in no way reduce the amount of Severance Compensation payable under this Section 5.



Section 6. Miscellaneous.



6.1 Section 409A. For purposes of Section 4 or 5, whether a “termination of employment” has occurred
shall be determined as set forth in Proposed Regulation §1.409A-3(h)(1) or any successor regulations. Notwithstanding
the foregoing provisions of this Section 4 or 5, in the event as of the date of termination of employment, Employee is
a “specified employee” as such term is defined under Section 409A of the Internal Revenue Code of 1986 (the “Code”)(or
any regulations or proposed regulations promulgated thereunder) each payment that would have been due to be made to
employee during the first six (6) months after such termination shall be delayed to the extent required and all such
delayed payments shall be made in a single lump sum on the first business day after the six –month anniversary of such termination unless an exception to such delay is otherwise applicable under the Code or regulations thereunder.



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6.2 Notice. Except as set forth below in this Section 6.2, any notice under this Agreement must
be in writing and shall be deemed to have been given when delivered personally or by overnight courier service or three
days after being sent by mail, postage prepaid, at the address indicated below or to such changed address as such
person may subsequently give such notice of:



if to Employer:




Peerless Mfg. Co.


14651 North Dallas Pkwy


Dallas, Texas 75254


Attn: Chairman, Board of Directors



if to Employee:




Warren Hayslip


5070 Rosewood Dr.


Doylestown, PA 18902



Notwithstanding the foregoing, the party receiving notice may waive any provisions of this Section 6.2 in its
or his sole and absolute discretion.



6.3 Assignment. This Agreement shall inure to the benefit of and be binding upon the parties hereto and
their respective heirs, personal representatives, successors, and assigns. Except as otherwise provided herein, this
Agreement may not be assigned by Employee without the prior written consent of the Employer and PMFG, Inc. Employer
shall require any successor, and any corporation or other person which is in control of such successor, to all or
substantially all of the business and/or assets of Employer (by purchase, merger, consolidation or otherwise), by
agreement in form and substance reasonably satisfactory to Employee, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that Employer would be required to perform it if no such succession
had taken place. Failure of Employer to obtain such agreement prior to the effectiveness of any such succession shall
be a material breach of this Agreement by Employer. As used in this Agreement, “Employer” shall mean Employer as
herein before defined and any successor to its business and/or all or part of its assets as aforesaid which executes
and delivers the assumption agreement provided for in this Section 6.3 or which otherwise becomes bound by all
the terms and provisions of this Agreement by operation of law.



6.4 Headings. The section headings used herein are for reference and convenience only and shall not enter
into the interpretation hereof.



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6.5 Counterparts. This Agreement may be executed in one or more counterparts for the convenience of the
parties hereto, all of which together shall constitute one and the same instrument.



6.6 Amendment and Waiver. The provisions of this Agreement may be amended or waived only by written
agreement of Employer and Employee, and no course of conduct, failure or delay in enforcing the provisions of this
Agreement shall effect the validity, binding effect or enforceability of this Agreement.



6.7 Severability. Any provision or portion of a provision of this Agreement that is held to be invalid or
unenforceable will be severable, and this Agreement will be construed and enforced as if such provision, or portion
thereof, did not comprise a part hereof, and the remaining provisions or portions of provisions will remain in full
force and effect. In lieu of each invalid or unenforceable provision there will be added automatically as part of this
Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be legal,
valid, and enforceable.



6.8 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the
State of Texas, without giving effect to any conflicts of law rule or principle that might require the application of
the laws of another jurisdiction.



6.9 Indemnification. Employee shall be subject to, and entitled to the benefit of, the indemnification
provisions contained in the Employer’s Articles of Incorporation and Bylaws, as amended, to the same extent and degree
as other similarly situated officers and/or directors of Employer.



6.10 Disputes. The parties to this Agreement agree that in the event there is a dispute or controversy
between them that cannot be settled through direct discussions, it is in the best interests of all for such dispute or
controversy to be resolved in the shortest time and with the lowest cost of resolution as practicable. Consequently,
any such dispute, controversy or claim between the parties to this Agreement will not be litigated, but instead will be
resolved by arbitration in accordance with Title 9 of the U.S. Code (United States Arbitration Act) and the Commercial
Arbitration Rules of the American Arbitration Association (the “Rules”), and judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. The arbitration will be before one neutral
arbitrator and will proceed under the Expedited Procedures of said Rules. The arbitration will be held in Dallas,
Texas, or such other place as may be selected by mutual agreement. The arbitrator will have the discretion to order a
prehearing exchange of information by the parties, and to set limits for both the scope and time period of such
exchange. All issues regarding exchange requests will be decided by the arbitrator. Neither party nor the arbitrator
may disclose the existence, content or results of any arbitration hereunder, unless required to do so by court or
regulatory order, without the prior written consent of both parties. Administrative fees and expenses of the
arbitration itself will be borne by the parties equally unless otherwise required by law, a court of competent
jurisdiction or the Rules; provided, that, in no event will Employee be required to pay in excess of $1,000 of such
fees and expenses. The arbitrator will also be authorized to award to the prevailing party all or that fraction of its
reasonable costs and fees as is deemed equitable. Costs of a party’s representation by counsel or preparation costs
for hearing are not considered administrative fees and expenses for purposes hereof. This provision will not apply to any claim for injunctive relief sought by the
Employer or any of its affiliates under Section 2 or 3 of this Agreement.



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6.11 Entire Agreement. This Agreement embodies the complete agreement between Employer and Employee
regarding the subject matter hereof and supersedes all prior agreements or understandings, whether oral, written or
otherwise, between the parties hereto that may have related in any way to the subject matter hereof.




EMPLOYER:




PEERLESS MFG. CO.



                                                                                  



Peter J. Burlage,


Chief Executive Officer





EMPLOYEE:



                                                                                   



Warren Hayslip




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