RICHARD A. TAMBORSKI EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”) is effective as of the 14 ^th day of January, 2008 (the “Effective Date”) between MISCOR Group, Ltd., an Indiana corporation (“MISCOR” or “Company”), and Richard A. Tamborski (the “Executive”).

In consideration of the mutual covenants and agreements set forth herein, the parties hereto agree as follows:

The Company hereby employs Executive, and Executive accepts employment with the Company, upon the terms and conditions herein set forth.

1.1            Employment .  The Company hereby employs Executive, and Executive agrees to serve, as the Company’s Executive Vice President and Chief Operating Officer during the term of this Agreement.  Executive agrees to perform such duties as may be assigned to Executive from time to time by the Company’s Chief Executive Officer. Executive agrees to devote substantially his full business time and attention and best efforts to the affairs of the Company during the term of this Agreement.

1.2            Term .  The term of employment of Executive hereunder will be for the period commencing on the effective date of this Agreement and ending on the earliest of:

(a)           January 14, 2011  (the “Initial Term”);

(b)           The date of termination of Executive’s employment in accordance with Article IV of this Agreement;

(c)           The date of Executive’s voluntary retirement in accordance with the Company’s plans and policies; or

(d)           The date of Executive’s death or Disability (as defined below).

Unless this Agreement is terminated pursuant to Paragraphs (b), (c) or (d) above, the term of this Agreement shall be extended automatically for successive one year periods, unless and until at least three (3) months written notice is given by either party requesting termination or renegotiation of this Agreement prior to the end of the Initial Term or any anniversary date thereafter.

2.1            Base Salary .  Effective as of the Effective Date and during the employment of Executive, the Company shall pay to the Executive a base salary at the rate of Two Hundred Thousand Dollars ($200,000) per year, and thereafter at a rate determined by the Company’s

Board of Directors (the “Base Salary”). The Base Salary shall be payable in substantially equal bi-weekly installments, or otherwise consistent with the Company’s then-current payroll practices.

2.2            Bonus.   Assuming Employee continues to be employed by Company, Company will establish an incentive program that will allow for an annual incentive of up to 30% of Base Salary (the “Bonus”), with payments to be made quarterly within sixty (60) days of the end of each quarter, based on performance goals or criteria to be determined jointly by Company and Employee.

2.3            Automobile Allowance.   Company will provide Employee with an automobile allowance of seven hundred and fifty dollars ($750) per month through the term of this Employment Agreement.  Company will also provide Employee with a company fuel card.

2.4            Withholding.   The Company will deduct and withhold all necessary social security and withholding taxes and any other similar sums required by law (“Withholding Taxes”) from Executive’s Base Salary, Bonus, and Automobile Allowance, to the extent required by law.

2.5            Equity.    On February 7, 2008, the Compensation Committee of MISCOR Group, Ltd. granted to Employee, conditioned upon execution of this agreement and the approval by the Company’s Shareholders of an amendment to the Option Plan allowing issuance of additional shares under that Plan:

2.6            Reimbursement of Expenses .  The Executive shall be entitled to receive prompt reimbursement of all reasonable expenses incurred by the Executive in performing services hereunder, including all expenses of travel, car phone, entertainment and living expenses while away from home on business at the request of, or in the service of, the Company, provided that such expenses are incurred and accounted for in accordance with the policies and procedures established by the Company.

2.7            Benefits .  The Executive shall be entitled to participate in and be covered by all health insurance, retirement, disability insurance, physical exam and other employee plans and benefits as established or amended by the Company from time to time (collectively referred to herein as the “Company Benefit Plans”) on the same terms as are generally applicable to other senior executives of the Company, subject to meeting applicable eligibility requirements.

2.8            Vacations and Holidays .  During Executive’s employment with the Company and in accordance with the Company’s vacation policies applicable to senior executives, Executive shall be entitled to an annual vacation leave at full pay, such vacation to be two weeks in each year of the term hereof or such greater vacation benefits as may be provided for by the applicable Company policies.  Executive shall be entitled to such holidays as are established by the Company for all employees.

2.9            Short-term Disability . During Executive’s employment with the Company, Executive shall be provided with short-term disability coverage for a period of up to 6 months at 60% of base salary.

3.1            Confidentiality .  Executive acknowledges that he will be employed in a position of trust and confidence with respect to the Company.  In particular, the Company and Executive recognize that to provide a high quality of products and services to the Company’s customers, which benefits both the Company and Executive economically, the Company will need to reveal to Executive valuable Confidential Information (defined below) known and used by the Company and its subsidiaries, affiliates and customers.  Executive will not during Executive’s employment by the Company or thereafter at any time disclose, directly or indirectly, to any person or entity or use for Executive’s own benefit any trade secrets or confidential information relating to the Company’s, or any of the Company’s subsidiaries’ or affiliates’, business operations, marketing data, business plans, strategies, employees, negotiations and contracts with other companies, or any other subject matter pertaining to the business of the Company or any of its clients, customers, consultants, licensees, subsidiaries or affiliates, known, learned, or acquired by Executive during the period of Executive’s employment by the Company (collectively “Confidential Information”), except as may be necessary in the ordinary course of performing Executive’s particular duties as an employee of the Company.

3.2            Return of Confidential Material .  Executive shall promptly deliver to the Company on termination of Executive’s employment with the Company, whether or not for cause and whatever the reason, or at any time the Company may so request, all memoranda, notes, records, reports, manuals, drawings, blueprints, and any other documents of a confidential nature belonging to the Company or its subsidiaries or affiliates, including all copies of such materials which Executive may then possess or have under Executive’s control.  Upon termination of Executive’s employment by the Company, Executive shall not take any document, data, or other material of any nature containing or pertaining to the proprietary information of the Company or its subsidiaries or affiliates.

3.3            Restrictive Covenants .  To reduce the cost to the Company of monitoring and enforcing the compliance of Executive with the confidentiality obligations contained in Section 3.1 of this Agreement, Executive agrees that he will not, so long as he is employed by the Company and, in the case of Section 3.3(b), (c) and (d), for the longer of (i) a period of one (1) year from and after the date of termination of his employment, or (ii) the period during which

Executive receives any compensation from the Company under the terms of Section 4.4(b) (the “Restricted Period”):

(a)           directly or indirectly own an interest in, manage, operate, join, control, lend money or render financial assistance to, as an officer, employee, partner, stockholder, consultant or otherwise, any individual, partnership, firm, corporation or other business organization or entity that, at such time directly competes with, or intends to compete with, the Company or any of its subsidiaries or affiliates in any principal line of business engaged in by the Company or any of its subsidiaries or affiliates at the time of such termination (a “Competing Company”) within the Prohibited Territory (as defined below); Notwithstanding the foregoing, Executive shall be entitled to own securities of any entity if such securities are registered under Section 12(b) or (g) of the Securities Exchange Act of 1934, as amended, and, upon approval of the Company’s Board of Directors, Executive shall be entitled to purchase securities of a Competing Company entity if such securities are offered to investors irrespective of any employment or other participation in the entity by the investor;

(b)           directly or indirectly, either for Executive or for any other person or entity, solicit any person or entity to terminate such person’s or entity’s contractual and/or business relationship with the Company or any of its subsidiaries or affiliates, nor shall Executive interfere with or disrupt or attempt to interfere with or disrupt any such relationship;

(c)           engage for the benefit of himself or any other person or entity, in any activity of employment in the performance of which it could be reasonably anticipated that he would be required or expected to use or disclose Confidential Information obtained while an employee of the Company; or

(d)           directly or indirectly solicit any of the Company’s employees, agents, or independent contractors to leave the employ of the Company for a Competing Company.

For purposes of this Agreement, the “Prohibited Territory” means anywhere within a one hundred (100) mile radius of each of Company’s locations, unless that geographic restriction is deemed to be of unreasonably broad scope, and therefore unenforceable, by a court of competent jurisdiction, in which case the next sentence shall define the Prohibited Territory.  The Prohibited Territory means anywhere within a seventy-five (75) mile radius of each of Company’s locations, unless that geographic restriction is deemed to be of unreasonably broad scope, and therefore unenforceable, by a court of competent jurisdiction, in which case the next sentence shall define the Prohibited Territory.  The Prohibited Territory means anywhere within a fifty (50) mile radius of each of Company’s locations.

In the event of a violation by Executive of the provisions of Section 3.3(b), (c) or (d) following termination of employment, Executive hereby forfeits any amount due and owing Executive under the terms of Section 4.4(b), if any, and such forfeiture shall be in

addition to all other rights and remedies that the Company may have under this Agreement, at law or in equity, as a result of any such violation.

3.4            Intellectual Property .

(a)            Disclosure .  During the term of this Agreement and during the one year period after termination of Executive’s employment hereunder, Executive shall promptly and fully disclose to the Company all computer programs, documenta­tion, software, and other copyrightable works (“copyrightable works”), and all discoveries, improvements, and inventions (“inventions”) conceived, reduced to practice, or made by Executive, whether solely or jointly with others, which:  (i) relate in any manner to the business or activities of Company and any of its subsidiaries or affiliates; or (ii) are suggested or result from any work performed or duties assigned to Executive on behalf of Company or any of its subsidiaries or affiliates; or (iii) are made or conceived of through the use of Company’s, or any of its subsidiaries’ or affiliates’, facilities or resources or using any Confidential Information; or (iv) otherwise arise during the course of Executive’s employment with Company (collectively, “Intellectual Property”); except that the term “Intellectual Property” shall not include any copyrightable works or inventions which Executive proves to have been conceived and made by him either before or after termination of his employment with Company and not based upon any Confidential Information.  This disclosure requirement will apply whether or not such Intellectual Property is patentable or copyrightable and whether or not made or conceived solely by Executive or in conjunction with another person.  This disclosure requirement will also apply regardless of whether any Intellectual Property is made during or after Executive’s working hours or made at or away from his usual place of employment.

(b)            Ownership .  All Intellectual Property shall be the exclusive property of the Company, and Executive hereby irrevocably assigns to the Company any and all of his rights, title and interest in and to any and all such Intellectual Property.  Without limiting the generality of the foregoing, all Intellectual Property which constitutes copyrightable works shall be considered works made for hire for the benefit of the Company.  If any such work shall be deemed not to be a work made for hire, or if Executive should otherwise by operation of law be deemed to retain any rights to any such work, Executive hereby irrevocably assigns all of his righ