EXHIBIT 10.1


FORM OF
EMPLOYMENT AGREEMENT


Date:                        


Torotel
is pleased to provide you with this letter setting forth in general the scope
and terms of your employment with Torotel. This letter is intended to reflect
our mutual agreements regarding the terms and conditions of your employment
with Torotel, as follows:


1.      Employment. Torotel
agrees to employ you as its                         ,
and you agree to serve Torotel in such capacity, subject to the terms and
conditions hereinafter set forth.


2.      Term. The term
of your employment shall commence on the date hereof and, if not sooner
terminated pursuant to the terms hereof, shall expire on that date which is
three (3) years after the date hereof. Thereafter, your employment may be
continued by mutual agreement of you and Torotel, on such terms as are
acceptable to you and Torotel.


3.      Duties. You
agree that you will serve Torotel faithfully and diligently and that you will
fulfill the directions given to you by Torotel’s Board of Directors to the best
of your ability during your employment, and that you will devote your full-time
efforts and attention to the business of Torotel, excluding reasonable vacation
and sick leave in accordance with Torotel policies.


4.      Compensation. As
compensation for services rendered by you to Torotel, you shall receive from
Torotel:


(a) 
An initial Base salary of            
per month (“Base Salary”), payable to you in bi-weekly installments during your
employment, subject to annual adjustments by the Torotel Board of Directors in
its sole discretion;


(b) 
Automobile Lease (if applicable); and


(c) 
Bonus and Stock Options as determined by the Board of Directors;


5.      Employee Benefits.


Medical and Insurance Benefits.
You will be entitled to receive all employee benefits provided to Torotel
employees generally from time to time, so long as and to the extent the same
exist.


Vacation, Sick Leave and Holidays.
You shall be entitled to vacation, sick leave and holidays in accordance with
Torotel’s policy as it exists from time to time. You understand that under
Torotel’s current policy.


Employee Option Plan. You shall
be entitled to participate in Torotel’s employee stock option plan, in
accordance with the terms of such plan, as it may be amended from time to time.


6.      Confidentiality/Non-Solicitation.


(a) 
While employed, you will learn important proprietary information related to
Torotel’s business, including, but not limited to, confidential and proprietary
information concerning corporate strategies and planning in the area of
strategic growth. You acknowledge that the proprietary customer, operations,
financial, and business information that has been or will be learned (i) has
been and will be developed through Torotel’s expenditure of substantial effort,
time and money; and (ii) together with relationships developed with
customers and employees, could be used to compete unfairly with Torotel during
the post-employment period. Because Torotel’s ability to provide services on a
competitive basis depends, in part, on its proprietary information and customer
relationships, Torotel would not share such information and promote your
relationship with customers if Torotel believed that you would use or disclose
such information or relationships in competition with Torotel, or if Torotel
believed that your relationship with Torotel’s employees or customers would be
used to the detriment of Torotel.


(b) 
You shall protect Confidential Information from disclosure. “Confidential
Information” is any and all information (no matter in what form) relating to
Torotel’s intellectual property, customers, operations, finances, and business
that derives value from not being generally known to others. It includes, but
is not limited to, technical or non-technical data, formulas, patterns, compilations,
programs, devices, methods, techniques, drawings, processes, financial data, or
lists of 











actual or potential customers or suppliers (including
identifying information about those customers), whether or not reduced to
writing. Confidential Information includes information disclosed to Torotel by
third parties that Torotel is obligated to maintain as confidential. Confidential
Information may include information that is not privileged nor a trade secret,
but information that is not privileged and also not a trade secret shall
constitute Confidential Information only for two years after termination of
your employment. You will not use, except in connection with work for Torotel,
and will not disclose during or after your relationship with Torotel, Torotel’s
Confidential Information. Upon the termination of your employment, or for any
reason or at any time at Torotel’s request, you will deliver promptly to
Torotel all materials, documents, plans, records, notes, or other papers and
any copies in your possession or control relating in any way to Torotel’s
business, which at all times shall be the property of Torotel.


(c) 
During your employment and for two (2) years thereafter, you will not
solicit for employment with any individual, corporation, partnership,
association, franchise, unincorporated organization or other entity, any person
who is or was, at any time during the year prior to the date of termination of
your employment, a Torotel employee.


(d) 
Because you will be affiliated with and benefit from Torotel’s name and good
will and relationship with its customers, and will have access to Confidential
Information about Torotel’s customers, you will not, while employed by Torotel,
solicit any Torotel customer for the purpose of providing products or services
offered by Torotel, other than on behalf of Torotel. In addition, for a period
of two (2) years after the termination of your employment, you will not
solicit Customers for the purpose of providing products or services identical
to or competitive with Torotel’s services. “Customers” are customers of Torotel
in the United States that you, during the year prior to the termination of your
employment, (i) serviced or solicited on behalf of Torotel; (ii) supervised
others servicing or soliciting on behalf of Torotel; or (iii) about whom
you had Confidential Information.


7.      Expense Reimbursement.
Torotel will reimburse you for all reasonable, out-of-pocket expenses,
including but not limited to reasonable travel expenses incurred in the
performance of your employment duties under this letter. Torotel will review
and pay such expenses in accordance with its normal procedures for paying the
expenses of employees, including such documentation requirements as may be
adopted from time to time.


8.      Termination.


(a) 
This letter agreement shall terminate: (a) if you die, resign voluntarily,
retire, voluntarily take another position requiring a substantial portion of
your time, or become disabled under circumstances in which you would be
entitled to benefits under your long-term disability insurance policy (if any);
(b) at the end of three years from the date of employment, unless extended
by mutual agreement of you and Torotel; or (c) at any time and without
prior notice, for “Cause” (as defined below).


(b) 
For purposes of this Agreement, “Cause” means (a) your willful and
continued failure to perform your duties (other than any such failure resulting
from your incapacity due to physical or mental illness), after demand for
substantial performance is delivered to you by Torotel that specifically
identifies the manner in which you have not performed your duties; (b) the
engaging by you in gross negligence or willful failure to perform a material
duty; or (c) your conviction of a felony crime.


(c) 
In the event that you are terminated without Cause prior to the end of the
three (3) year term of this Agreement, you will receive a severance
payment as follows: if the termination without Cause occurs during the first
two years of this Agreement, you will receive a lump sum severance payment in
the amount of twelve (12) times your monthly Base Salary; if the termination
without Cause occurs during the third year of this Agreement, you will receive
a lump sum severance payment in the amount of six (6) times your monthly
Base Salary.


9.      Miscellaneous.


(a) 
Interpretation. The paragraph headings
contained herein are for the purpose of convenience of reference only and are
not intended to define or limit the contents of such paragraphs. In this
letter, (i) all gender references include the feminine and the masculine
and (ii) the singular includes the plural, and the plural the singular.











(b) 
Severability. If all or any provision or
portion of this letter shall to any extent be held invalid or unenforceable, in
whole or in part, by a court or agency having competent jurisdiction, a valid
decision or decree to which Torotel is a party, then the parties expressly
agree to be bound by any lesser covenant imposing the maximum legal duty
permitted by law that is subsumed within the terms of such covenant, as if the
resulting covenants were separately stated in and made a part of this letter,
and the remainder of this letter shall remain in full force and effect.


(c) 
Equitable Relief. You and Torotel
acknowledge and agree that breach of any of the covenants made by you herein
would cause irreparable injury to Torotel, which could not sufficiently be
remedied by monetary damages, and therefore that Torotel shall be entitled to
obtain such equitable relief as declaratory judgments; temporary, preliminary,
and permanent injunctions; and order of specific performance to enforce those
covenants or to prohibit any act or omission that constitutes a breach thereof.


(d) 
Amendment. This letter may be altered or
amended only by a writing signed by all parties hereto. This letter shall
automatically terminate upon your death. This letter is the final, complete and
exclusive statement and expectation of the agreement between you and Torotel.


(e) 
Governing Law. This letter shall be
construed under and governed by the laws of the State of Missouri.


(f) 
No Improper Use of Information or Violation of
Agreements with Prior Employers and Others. During your employment,
you will not improperly use or disclose any confidential information or trade
secrets or violate any non-competition or other agreement with, any former
employer or any other persons to whom you have an obligation of confidentiality
or noncompetition. You will not bring onto the premises of Torotel any
unpublished documents or any property belonging to any former employer or any
person to whom you have an obligation of confidentiality, unless consented to
in writing by that former employer or person. You will use in the performance
of your duties only information that is generally known and used by persons
with training and experience comparable to your own, which is common knowledge
in the industry or otherwise legally in the public domain, or which is
otherwise provided or developed by Torotel.


(g) 
Assignment. You understand that you have
been selected for employment by Torotel on the basis of your personal
qualifications, experience and skills. Therefor, you shall not assign all or
any portion of your performance under this letter.


If the foregoing adequately reflects your
understanding of our agreement, please indicate your affirmation by signing the
enclosed copy of this letter and returning it to me at the above listed
address.


	
   

  	
  Sincerely,

  
	
   

  	
  TOROTEL, INC.

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


The undersigned hereby
agrees to the terms of the

foregoing letter:


	
   

  	
   

  
	
  (Employee)

  	
   

  
	
  Date: