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 be from                                      
and, if not sooner terminated pursuant to the terms hereof, shall expire on
that date which is three (3) years after the date hereof.  If a new agreement for employment has not
been executed prior to six months before the end of this agreement the existing
agreement will be extended for one additional year and continue in this manner
until a new agreement is executed or the current agreement is terminated.


 


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.  Your
place of employment will be in the Kansas City metropolitan area and will
involve the normal duties associated with the positions as                                                 .  Should you be required to move out of the
Kansas City metropolitan area or if your duties are reduced you will have the
option of accepting the changes or terminating your employment with full
payment for the remaining term of your employment agreement.  This shall include 4.(a,b,c), and
5.(a,b,c).  In addition all bonus earned
will be paid and all stock options will be immediately fully vested.


 


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) Lease
of a Chevrolet Tahoe or the equivalent as mutually agreed to.  Includes insurance, fuel and normal service.


 


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


 


5.                                      Employee
Benefits.


 


(a)           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.


 


(b)          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.


 


(c)           (c) 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 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 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.


 


(e) The
Company agrees that it shall make no disparaging remarks, written or verbal,
intended to adversely affect or having a foreseeable result of adversely
affecting Employee’s good name or reputation.


 


(f) Employee
agrees that he shall make no disparaging remarks, written or verbal, intended
to adversely affect or having a foreseeable result of adversely affecting the
Company’s businesses or the good name or reputation of any of its employees.


 


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-year term of this Agreement, you
will receive a lump sum severance payment in the amount equal to one year of
salary, bonus and benefits.


 


(e) In the event of a change in control
of the company the employee if offered a position to remain with the company
may elect to select the offer or my elect to take a lump sum payment for the
remaining term of the employment contract as described in item 8.(c).


 


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 Kansas.


 


(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
non-competition.  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.  Therefore, 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:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [NAME]

  	
   

  
	
   

  	
   

  
	
  Date: