Torotel 110106

Company Name: Torotel, Inc.
Public Availability Date: November 1, 2006

Document Sections:

INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
APPENDIX
INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
STAFF REPLY LETTER

[INQUIRY LETTER]

August 2, 2006

Office of Chief Counsel
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549

Re: Omission of Shareholder Proposal of Basil P. Caloyeras

Dear Ladies and Gentlemen:

This letter is to inform you that it is the intention of our client, Torotel, Inc. (the "Company"), to omit from its proxy statement and form of proxy for its 2006 Annual Meeting of Shareholders (collectively, the "2006 Proxy Materials") the Proposal (as defined in Section II.C. below) submitted by Basil P. Caloyeras (the "Proponent"). The Proposal Letters (as defined below) are attached hereto as Exhibit A.

We hereby notify the Division of Corporation Finance (the "Division") of the Securities and Exchange Commission (the "Commission") of the Company's intention to exclude the Proposal from its 2006 Proxy Materials, and we respectfully request that the staff of the Division (the "Staff") concur in our view that the Proposal is excludable because: (a) the Proposal contains multiple shareholder proposals in violation of Rule 14a-8(c); (b) the Proposal was not submitted in a timely manner in accordance with Rule 14a-8(e); (c) the Proposal violates certain anti-bundling requirements in Rule 14a-4; and (d) the Proposal's supporting statement contains false and misleading statements in violation of Rule 14a-9. For avoidance of confusion, the capitalized term "Rule" refers to a rule under Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended.

Pursuant to Rule 14-8(j)(2), I am enclosing six copies of (i) this letter, (ii) the Proposal Letters and (iii) the Deficiency Letter (as defined below). In accordance with Rule 14a-8(j), a copy of this submission is being sent to the Proponent.

I. Waiver of 80-Day Submission Requirement under Rule 14a-8(j)(1)

As a preliminary matter, the Company hereby requests that it be permitted to file, and the Commission accept, this submission less than 80 days prior to the anticipated filing date of the 2006 Proxy Materials. The Company's 2006 Annual Meeting of Shareholders is set to be held on September 18, 2006 and the delivery to the shareholders of the 2006 Proxy Materials is planned to be on or about August 18, 2006. Based on the foregoing, the deadline was May 29, 2006 for submission to the Commission of a no action request for exclusion of a shareholder proposal. Considering the Company did not receive the initial Caloyeras proposals until July 5, 2006 or the Proposal (which is the revision of those proposals into one proposal) until July 21, 2006 (more than one month and almost two months, respectively, past the May 29, 2006 deadline), a timely submission by the Company was not possible.

As discussed later in this letter, the Company believes the Proponent had no justifiable reason for submitting the Proposal (or its predecessor proposals) in such an untimely fashion. The proxy materials for the 2005 Annual Meeting of Shareholders (the "2005 Proxy Materials") specifically stated that the deadline for submission of shareholder proposals for inclusion in the proxy statement was April 21, 2006. Furthermore, the date of the 2006 Annual Meeting of Shareholders was not moved more than 30 days from the date of the 2005 Annual Meeting of Shareholders, which was convened on September 19, 2005. Finally, as the letter from the Company to the Proponent attached hereto as Exhibit B (the "Deficiency Letter") and the submission of this letter evidence, the Company has acted in a timely manner responding to the Proponent regarding its submission and in submitting this letter to the Division.

Rule 14a-8(j)(1) provides that if a company intends to exclude a proposal from its proxy materials, it must file its reasons with the Commission no later than 80 calendar days before it files its definitive proxy statement and form of proxy with the Commission; provided, however, that the Staff may permit the company to make its submission later than 80 days before the company files its definitive proxy statement and form of proxy, if the company demonstrates "good cause" for missing the deadline. The Staff has previously found such good cause to exist where the proponent has not provided the proposal in a timely manner so as to allow the company to respond within the time periods required by Rule 14a-8(j)(1). See, e.g., Selectica, Inc. (August 25, 2005); Xerox Corp. (May 2, 2005); General Electric Company (February 10, 2005); Staff Legal Bulletin No. 14B (September 14, 2004) (noting that the most common basis for a company's showing of good cause is that the proposal was not submitted in a timely fashion and the company did not receive the proposal until after the 80-day deadline had passed).

Based on the facts and precedent set forth above, the Company requests that the Commission accept this submission and waive the 80-day advance submission requirement of Rule 14a-8(j)(1).

II. Background

A. Relevant Dates Listed in 2005 Proxy Materials and General Background

As noted above, the 2005 Proxy Materials stated that shareholders intending to have their proposals included in the 2006 Proxy Materials had to submit such proposals to the Company no later than the close of business on April 21, 2006. Furthermore, the 2005 Proxy Materials stated that proposals to be presented at the 2006 Annual Meeting of Shareholders, but not to be included in the 2006 Proxy Materials, were required to be submitted to the Company no later than July 5, 2006.

The date of the 2006 Annual Meeting of Shareholders is set for September 18, 2006, which is almost the same date as the date of the 2005 Annual Meeting of Shareholders, which was September 19, 2005. As discussed later in this letter, the Proponent asserts that the 2005 Annual Meeting of the Shareholders never took place; however, the 2005 Annual Meeting of Shareholders was called to order but had to be adjourned when the Proponent and his voting group revoked their proxies and withdrew from the meeting. These actions by the Proponent and his voting group were in response to the Proponent and the voting group being ruled out of order for violating the advance notice provisions set forth in the Company's 2005 Proxy Materials and Form 8-K dated April 26, 2005. The 2005 Annual Meeting of Shareholders was never reconvened. Instead, the Company's board of directors had further discussions with the Proponent and other members of his family and understood that the Proponent and his family were considering making a proposal to acquire the Company if the Proponent could obtain adequate funding.

B. July 5th Proposal Letter

On July 5, 2006, the Company received a letter (the "July 5th Proposal Letter") on behalf of the Proponent and his sisters who are also shareholders of the Company requesting that the proposals listed below in this Section II.B. be included in the 2006 Proxy Materials. Counsel for the Proponent and his sisters stated in the July 5th Proposal Letter that he believed such proposals should be included in the 2006 Proxy Materials under Rule 14a-8(e), which allows shareholder proposals to be submitted for inclusion in a proxy statement at any reasonable time before the Company begins to print and mail its proxy materials if no annual meeting was held in the previous year.

The proposals in the July 5th Proposal Letter were:

1. Eliminate the staggered terms of the Board of Directors, effective immediately. All terms of all directors will expire at the annual meeting on September 18, 2006; and

2. No amendments to Torotel's Bylaws may be made without the approval of a majority of the shareholders of Torotel.

In accordance with Rule 14a-8(f) and via the Deficiency Letter, the Company notified the Proponent that a shareholder may not submit more than one proposal to a company for a particular shareholders' meeting and that the submission on behalf of the Proponent constituted multiple proposals. The Deficiency Letter advised the Proponent to choose one of the proposals to be the proposal he wished to submit and requested that the Proponent advise the Company of his choice within 14 calendar days of receipt of the Deficiency Letter. The Company also sent similar letters to the Proponent's sisters who were listed on the July 5th Proposal Letter. In each case the Company invited each shareholder to re-submit one proposal, thus complying with the "one proposal" rule. In light of this, the Proponent and each of his sisters could have each submitted a different proposal and satisfied the "one proposal" rule.

C. The July 21st Proposal Letter

The Proponent responded to the Deficiency Letter by letter dated July 21, 2006 (the "July 21st Proposal Letter" and, together with the July 5th Proposal Letter, the "Proposal Letters") whereby the Proponent submitted the proposal listed in this Section II.C. below (the "Proposal"). Although we did not receive any correspondence from the Proponent or his sisters that they were withdrawing the proposals in the July 5th Proposal Letter, based on the fact that the Proposal is virtually identical to the proposals in the July 5th Proposal Letter, it is reasonable to assume that the Proponent and his children have withdrawn such proposals and that Proponent submitted the Proposal in lieu thereof. As the Staff will note, the Proposal is simply the bundling and revision of the proposals in the July 5th Proposal Letter.

The Proposal consists of a single resolution proposing two distinct amendments to the Company's Articles of Incorporation. As stated above, the Proposal is the melding of the proposals in the July 5th Proposal Letter and a new resolution into a unitary resolution. The text of the Proposal is as follows:

RESOLVED, that the shareholders of Torotel, Inc. ("Corporation") approve amending Articles Six and Nine of the Corporation's Articles of Incorporation to remove certain provisions of the Corporation's Bylaws that unduly restrict shareholder rights and decrease shareholder value as follows:

Article Six:

"The number of Directors is five. Directors shall be elected by Shareholders holding not less than 50% of outstanding shares at each annual meeting of Shareholders, but if such annual meeting is not held or Directors are not elected thereat, Directors may be elected at a special meeting of Shareholders. Directors shall hold office until the next annual meeting and until their successors are elected and qualified. The declassification effectuated by this provision shall not affect unexpired terms of Directors previously elected."

Article Nine:

"Only a majority of Shareholders may make, alter, amend, suspend or repeal the Bylaws. With respect to the Bylaws currently in effect, each of the following provisions is hereby revoked in its entirety: Article II, Sections 13, 14, and 15; Article III, Section 2, 8, and 10 and Article XIII. Article II, Section 2 shall be amended to read that a special meeting of Shareholders may be called by the President, Board of Directors or Shareholders holding not less than 15% of outstanding shares of the Corporation."

III. Bases for Excluding the Proposal

A. The Proposal May Be Excluded Pursuant to Rule 14a-8(c) Because the Proposal Constitutes Multiple Proposals

Rule 14a-8(c) states that "[e]ach shareholder may submit no more than one proposal to a company for a particular shareholders' meeting." The Staff has consistently held that a company may omit multiple proposals, even if couched as a single proposal that contains substantially different matters. However, if a shareholder submits multiple proposals, causing such submission to be procedurally deficient, Rule 14a-8(f) requires a company to notify the proposing shareholder of the deficiency within 14 days of receipt of such proposal. Rule 14a-8(f) allows the shareholder 14 days from the time it receives a company notification to correct any such procedural deficiency. Because the Proposal, which was submitted to correct the proposals in the July 5th Proposal Letter, contains more than one proposal, the Company requests that the Staff concur in its view that the Proposal may properly be omitted from the 2006 Proxy Materials.

The Proposal constitutes multiple proposals and therefore violates Rule 14a-8(c). The test for whether a proposal constitutes multiple proposals is whether the elements of the proposal relate to a single concept. See HealthSouth Corporation (April 6, 2006) (permitting the exclusion of a single resolution seeking to amend two separate and distinct bylaws); IGEN Int'l, Inc. (July 3, 2000) (permitting the exclusion of a proposal that, among other things, would require the size of the issuer's board of directors to be increased to eight members, require monthly board meetings, and permit any shareholder owning five percent or more of the company's outstanding stock to call a shareholder's meeting); Fotoball, Inc. (May 6, 1997) (permitting exclusion of proposals relating to a minimum share ownership of directors, form of director compensation and business relationships between the issuer and its non-employee directors). Furthermore, the Staff has consistently agreed that substantially different items of business may not be considered a single proposal for purposes of Rule 14a-8(c), notwithstanding the fact that the distinct items of business may relate to the same general topic. See Exxon Mobil Corp. (March 19, 2002) (allowing exclusion of proposals regarding increasing the number of board nominees and qualifications for additional nominees); Evova Corp. (February 9, 1998) (allowing exclusion of a proposal to elect the entire board annually and require the appointment of an independent lead director because such proposal constituted multiple proposals); and Allstate Corp. (January 29, 1997) (allowing exclusion of proposals to institute cumulative voting for directors and to avoid specified actions that could impair the effectiveness of cumulative voting).

A plain reading of the Proposal evidences the fact that there is no single, unifying concept among the various proposals contained therein that is recognized by the Commission. One proposal within the Proposal addresses the number of directors. A second proposal within the Proposal pertains to majority voting for election of directors. A third proposal within the Proposal deals with de-classification of the board of directors. A fourth proposal within the Proposal removes the ability of the directors to amend the Company's Bylaws. A fifth proposal within the Proposal revokes in their entirety various sections of the Company's Bylaws. A sixth proposal within the Proposal addresses the ability of certain parties to call a special meeting of the shareholders.

Furthermore, it is important to note that in situations where the proponent alleges to have reduced the number of proposals to one, but has essentially just condensed all separate proposals into one proposal, the Staff has permitted the exclusion of the "condensed" proposal. The Proponent has done just that. The Staff has concluded on numerous occasions that several unrelated proposals, when combined into one proposal, nevertheless constitute more than one proposal. See HealthSouth Corporation (April 6, 2006); Fotoball, Inc. (May 6, 1997); Edison Int'l (January 22, 1997); Doskocil Companies Inc. (May 4, 1994); Delta Air Lines, Inc. (July 9, 1993).

Because the Proposal contains multiple proposals that are unrelated and do not satisfy the criteria set forth by the Staff described above in order to be treated as one unified proposal, the mere act of consolidating such proposals is not sufficient to remedy the multiple proposal defect. See, e.g., Compuware Corp. (July 3, 2003) (finding exclusion of all proposals appropriate where the proponent submitted six separate and distinct proposals as only one resolution); HealthSouth Corporation (April 6, 2006) (finding exclusion of all proposals appropriate where proponent submitted two separate and distinct bylaw proposals as only one resolution). The Staff has consistently permitted the exclusion of proposals where the proponent submits more than one proposal and fails to timely reduce the number of proposals to one at the issuer's request. See, e.g., HealthSouth Corporation (April 6, 2006); IGEN Int'l., Inc. (July 3, 2000) (proposals may be omitted under Rule 14a-8(f) where shareholder submitted multiple proposals in violation of 14a-8(c) and did not cure the procedural deficiency within the period provided for by Rule 14a-8(f) after receiving specific notice thereof); Evova Corp. (Feb. 9, 1998) (same); BostonFed Bancorp, Inc. (March 5, 2001) (same); Niagara Mohawk Holdings, Inc. (March 23, 2000) (same). Accordingly, the Company believes it may properly exclude the Proposal in accordance with Rule 14a-8(c).

For the foregoing reasons, the Company respectfully submits that the Proposals may be excluded from the Company's 2006 Proxy Materials.

B. The Proposal May Be Excluded as Untimely

The Proposal is excludable under Rule 14a-8(i)(3) because it was submitted to the Company in an untimely manner in violation of Rule 14a-8(e)(2) which requires that shareholder proposals must be received at a company's principal executive offices not later than 120 calendar days before the date such company's proxy statement was released to shareholders in connection with the previous year's annual meeting. This 120 day date was calculated to be April 21, 2006 and such date was clearly stated in the 2005 Proxy Materials disseminated to all shareholders. The Staff has strictly construed the deadline for receipt of shareholder proposals under Rule 14a-8(e) and has consistently taken the position that untimely shareholder proposals may be properly excluded from a company's proxy materials under Rule 14a-8(e). See e.g., KB Home (January 10, 2006); Commerce Energy Group, Inc. (November 23, 2005); and DirectTV Group, Inc. (March 23, 2005). Based upon the facts described in Section II above and the foregoing precedent, the Proposal (and its predecessor proposals in the July 5th Proposal Letter) was not submitted in accordance with Rule 14a-8(e)(2) and, thus, is excludable from the 2006 Proxy Materials.

Furthermore, in anticipation of the Company's position and as evidence of Proponent's and his sisters' own acknowledgement of their failure to timely file, counsel to the Proponent and his sisters submitted the July 5th Proposal Letter noting their belief that the 2005 Annual Meeting had not been held and, therefore, they were entitled to submit the proposals contained therein in a "reasonable time before the company begins to print and mail its proxy materials" under Rule 14a-8(e)(2). This assertion is misfounded based upon the fact that the Proponent was aware that the meeting was called to order and that it was adjoumed immediately prior to voting on certain matters as discussed in Section II.A. above. Furthermore, the 2005 Annual Meeting of the Shareholders was never reconvened. Based on the fact the 2005 Annual Meeting was held and the 2006 Annual Meeting is scheduled to be held on a date not more than 30 days from the date of the 2005 Annual Meeting, the Proponent may not avail itself of the "reasonable time" provision of Rule 14a-8(c)(2).

Moreover, if it were to be assumed that the 2005 Annual Meeting was not held, the Proposal would still be excludable because the Proposal (and the proposals in the July 5 Proposal Letter) was not delivered to the Company in a "reasonable time before the company begins to print and mail its proxy materials." In determining whether a proposal is made within a reasonable time, the fundamental consideration is whether the time of submission of the proposal affords the company reasonable time to consider the proposal without causing an excessive delay in the distribution of its proxy materials to its shareholders. See, Jefferson-Pilot Corporation (January 30, 2006); Greyhound Lines, Inc. (January 8, 1999). The Proponent (and his sisters), as well as all shareholders of the Company, should have been aware of the deadlines for submission of shareholder proposals clearly stated in the 2005 Proxy Materials, as well as the date for the 2006 Annual Meeting which is clearly stated in the Company's Bylaws (a copy of which are attached to the Deficiency Letter). Considering the Company has never stated a different date for the 2006 Annual Meeting of Shareholders, the Proponent (and his sisters) lacks a reasonable basis for the belief that the 2006 Annual Meeting of Shareholders would be held on a different date and that the April 21, 2006 deadline for submission of proposals to be included in the 2006 Proxy Materials was therefore irrelevant. Along this line and based on the foregoing facts, it is unreasonable for the Proponent (and his sisters) to deliver the Proposal (and the proposals in the July 5th Proposal Letter) in July when he (and they) was aware that the Company (a) would mail its proxy materials in mid-August for the 2006 Annual Meeting of Shareholders and (b) would not be able to submit a no action request to the Commission 80 days prior to the mailing of the 2006 Proxy Materials.

For the foregoing reasons, the Company respectfully submits that the Proposals may be excluded from the Company's 2006 Proxy Materials.

C. The Proposal May Be Excluded Because It Violates Certain Anti-Bundling Requirements in Rule 14a-4(a)(3)

Rule 14a-8(i)(3) permits the exclusion of a proposal "if the proposal or supporting statement is contrary to any of the Commission's proxy rules." Rule 14a-4(a)(3) of the proxy rules sets forth certain anti-bundling prohibitions which require that the form of proxy "identify clearly and impartially each separate matter intended to be acted upon, whether or not related to or conditioned on the approval of other matters." The Proposal runs afoul of these anti-bundling requirements and, therefore, the Company believes that the Proposal is excludable from the 2006 Proxy Materials. This belief is consistent with the Staff's position as noted in Global Entertainment Holdings/Equities, Inc. (July 18, 2003) and Exxon Mobil Corp. (March 19, 2002).

The violation of this Rule occurs in several instances. First, the Proponent bundled the two enumerated proposals from the July 5th Proposal Letter as "one" proposal in the Proposal. Second, the Proposal (as with the proposals in the July 5th Proposal Letter) contains numerous proposals as noted in the third paragraph of Section III.A. These represent a gross violation of the "anti-bundling" rule. By combining multiple proposals in the Proposal, the Proponent fails to identify clearly each separate matter intended to be acted upon, in violation of Rule 14a-4(a)(3). Companies in a similar situation to the Company have noted that "[a] shareholder might wish to vote for one proposal, but not the other." Centra Software, Inc. (Mar. 31, 2003). Precisely the same could be said in this case. The provisions of the Proposal are separate and distinct. A shareholder might wish to vote for one proposal without being forced to vote for the other. For example, a shareholder may wish to reduce the number of directors to five, but may desire to continue to allow the board of directors to have equal power to amend the Bylaws. The shareholder's voting proposals would be restricted by a combination of the two proposals. Furthermore, a shareholder may want the power to amend the Bylaws limited to the shareholders, but may not agree that shareholders holding 15% of more of the Company's outstanding shares have the ability to call a special meeting.

For the foregoing reasons, the Company respectfully submits that the Proposals may be excluded from the Company's 2006 Proxy Materials.

D. The Proposal May Be Excluded Because Proponent's Supporting Statements Contain False and Misleading Statements in Violation of Rule 14a-9

Rule 14a-8(i)(3) permits the exclusion of a proposal "if the proposal or supporting statement is contrary to any of the Commission's proxy rules, including Section 240.14a-9, which prohibits materially false or misleading statements in proxy soliciting materials." The Company believes that various statements in Proponent's supporting statement are materially false and misleading, including but not limited to:

1. The supporting statement for the Proposal states that "[t]he new Bylaws are part of an overall plan by the current Board and management to retain excessive control of the Corporation at the shareholder's expense." The Proponent tenders this assertion as fact and fails to provide any support for this assertion, specifically evidence of this so-called "plan" of the board of directors. The board of directors adopted new Bylaws with advance notice provisions, limitations on the power of shareholders to call special meeting, and higher approval requirements for amendments to the Bylaws because the board of directors believed it was necessary and consistent with its fiduciary duties to protect minority shareholders from possible actions that could be taken by majority shareholders that would not be in the best interests of all shareholders. The statement by the Proponent was nothing more than an attempt to impugn the character of the board of directors in violation of Rule 14a-9.

2. The supporting statement for the Proposal states that "[t]he current Board has performed poorly compared to boards of similarly situated corporations, has failed to respond adequately to shareholder concerns and has voted in favor of employment agreements featuring poor pay-performance links." Once again, the Proponent tenders this assertion as fact without providing any support therefor. The Proponent does not offer a comparative analysis of similarly situated companies' boards of directors, cite any authoritative report or even list one similarly situated company with a better-performing board of directors. As with the previously described assertion, this statement is simply another attempt to impugn the character of the board of directors through baseless allegations in violation of Rule 14a-9.

For the foregoing reasons, the Company respectfully submits that the Proposals may be excluded from the Company's 2006 Proxy Materials.

CONCLUSION

Based on the foregoing, the Company requests that the Staff not recommend any enforcement action if the Proposal is excluded from the 2006 Proxy Materials. We request that the Staff deliver its response to this letter via U.S. mail and facsimile to the facsimile number on the first page of this letter (for the Company and its counsel) and to the facsimile number on the first page of the July 5th Proposal Letter (for the Proponent and his counsel). We hereby agree to promptly forward to the Proponent any Staff response to this no-action request that the Staff transmits by facsimile to us only.

Consistent with the provisions of Rule 14a-8(j), we are concurrently providing copies of this correspondence to the Proponent. We recognize that the Staff has not interpreted Rule 14a-8 to require proponents to provide the Company and its counsel a copy of any correspondence that the proponent submits to the Staff. Therefore, in the interest of a fair and balanced process, we request that the Staff notify the undersigned if it receives any correspondence on the Proposal from the Proponent or other persons, unless that correspondence has specifically confirmed to the Staff that the Company or its counsel have timely been provided with a copy of the correspondence. If we can provide additional correspondence to address any questions that the Staff may have with respect to this no-action request, please do not hesitate to call me at the number listed on the first page of this letter.

Sincerely,

STINSON MORRISON HECKER LLP

/s/

Victoria R. Westerhaus

Enclosures

cc: H. James Serrone
Basil P. Caloyeras

[INQUIRY LETTER]

July 5, 2006

Via Hand Delivery

Torotel, Inc.
M & H Agent Services, Inc.
1201 Walnut St., Suite 2800
Kansas City, MO 64106

Re: Torotel, Inc.

Dear Sir/Madam:

Pursuant to the definitive proxy statement filed by Torotel, Inc. ("Torotel") on August 19, 2005, the Notice of Shareholder Proposals to be acted on at Torotel's 2006 annual meeting must be received by Torotel on or before July 5, 2006 or else such proposals will be considered untimely. Please be advised that this letter serves as the official notice of Basil Caloyeras, Aliki Caloyeras and Alexandra Caloyeras as to the following items that they hereby submit for presentation at the 2006 annual meeting of Torotel:

Eliminate the staggered terms of the Board of Directors, effective immediately. All terms of all directors will expire at the annual meeting on September 18, 2006; and

No amendments to Torotel's Bylaws may be made without the approval of a majority of the shareholders of Torotel.

We are of the opinion that it is in the best interest of all of Torotel's shareholders that these items be included in the upcoming Proxy Statement, pursuant to Rule 14a-8(e), which provides that if there was no annual meeting in the previous year, as was the case for Torotel, then a shareholder proposal may be submitted for inclusion in the proxy statement at any reasonable time before the company begins to print and mail its proxy materials.

We look forward to the presentation of these items at the 2006 annual meeting of the shareholders of Torotel.

Very truly yours,

SEIGFREID, BINGHAM, LEVY, SELZER & GEE, P.C.

/s/

Robert C. Levy

RCL:KKS:jfe

cc: Torotel, Inc., 620 N. Lindenwood Drive, Olathe, KS 66062 (via hand delivery)
Victoria Westerhaus, Esq. (via hand delivery)
Howard Berman, Esq. (via e-mail)
Mr. Peter Caloyeras (via e-mail)
Mr. Basil Caloyeras (via e-mail)

[INQUIRY LETTER]

July 21, 2006

Torotel, Inc.
620 North Lindenwood Drive
Olathe, Kansas 66062

Attn.: Secretary

RE: Notice of Shareholder Proposal

To the Secretary of Torotel, Inc.:

I hereby submit the shareholder proposal attached hereto as Annex A to be voted upon at the Annual Meeting of Shareholders of Torotel, Inc. (the "Corporation") to be held on September 18, 2006. The reasons for conducting such business at the Annual Meeting are set forth in the Supporting Statement included in Annex A. I am the record and beneficial owner of 769,666 shares of the Corporation's common stock, which I have held for more than one year and will continue to hold through the date of the Annual Meeting of Shareholders. My record address is 2041 West 139th Street, Gardena, California 90249. I do not have a material interest in the business set forth in this proposal other than as a greater than 10% shareholder of the Corporation.

Respectfully submitted,

/s/

Basil P. Caloyeras

[APPENDIX]
Annex A

RESOLVED, that shareholders of Torotel, Inc. ("Corporation") approve amending Articles Six and Nine of the Corporation's Articles of Incorporation to remove certain provisions of the Corporation's Bylaws that unduly restrict shareholder rights and decrease shareholder value as follows:

Article Six:

Article Nine:

"Only a majority of Shareholders may make, alter, amend, suspend or repeal the Bylaws. With respect to the Bylaws currently in effect, each of the following provisions is hereby revoked in its entirety; Article II, Sections 13, 14, and 15; Article III, Sections 2, 8, and 10; and Article XIII, Article II, Section 2 shall be amended to read that a special meeting of Shareholders may be called by the President, Board of Directors or Shareholders holding not less than 15% of outstanding shares of the Corporation."

Supporting Statement

Restricting the ability of shareholders to take governance actions granted to them by law unduly restricts their rights and decreases shareholder value by preventing shareholders from legally protecting their investment in the Corporation.

The Board recently restated the Bylaws to restrict shareholders from properly presenting and acting upon matters at shareholder meetings. The amendments denied shareholders the right to call special meetings, imposed burdensome requirements to propose matters to be acted upon at shareholder meetings and to nominate director candidates, increased to two-thirds the shareholder vote required to amend the Bylaws, and created additional anti-takeover measures. These new Bylaws are part of an overall plan by the current Board and management to retain excessive control of the Corporation at the shareholder's expense.

The current Board has performed poorly compared to boards of similarly situated corporations, has failed to respond adequately to shareholder concerns and has voted in favor of employment agreements featuring poor pay-performance links. A smaller Board, in which members serve one-year terms, will facilitate more effective governance, reduce expenses and hold directors accountable to shareholders. A classified Board restricts the Corporation's ability to engage in reorganization transactions that might enhance shareholder value, by unduly limiting the ability of existing or new shareholders to provide direction to the Corporation.

This proposal is intended to make the Corporation more desirable for potential acquirors of shares of the Corporation's stock, who can improve the its operations and profitability. The proposal also restores to shareholders the power to exercise the full breadth of their rights under Missouri law and hold directors accountable to shareholders.

Please vote FOR this proposal.

[INQUIRY LETTER]

July 18, 2006

Via Overnight Delivery

Alexandra Z. Caloyeras
110 Sullivan Street, Apt. 4B
New York, NY 10012

Basil P. Caloyeras
2041 West 139^th Street
Gardena, CA 90249

Aliki S. Caloyeras
62 Watts Street #2
New York, NY 10014

Re: Shareholder Proposals for Torotel, Inc. 2006 Annual Meeting of Shareholders

Ladies and Gentlemen:

We acknowledge receipt of a letter dated July 5, 2006 (the "Proponents' Letter") from Robert C. Levy, Esq. on behalf of Alexandra Z. Caloyeras, Aliki S. Caloyeras and Basil P. Caloyeras (each a "Proponent" and, collectively, the "Proponents") regarding the Torotel, Inc. (the "Company") 2006 annual meeting of shareholders (the "2006 Shareholders Meeting"). The Proponents' Letter includes the following:

1. Shareholder proposal pertaining to the elimination of the classification of the Company's board of directors (the "Board");

2. Shareholder proposal pertaining to the expiration of the terms of all of the members of the Board at the 2006 Shareholders Meeting, which would have the effect of removing all members of the Board; and

3. Shareholder proposal providing that the Company's bylaws (the "Bylaws") can only be amended by the approval of a majority of the Company's shareholders.

Items 1-3 above are each a "Proposal" and, collectively, the "Proposals". We have attached hereto as Exhibit A, a copy of the Proponents' Letter.

This letter from the Company to the Proponents (this "Letter") sets forth the intentions of the Company to (a) decline to bring the Proposals before the 2006 Shareholders Meeting pursuant to Section 14 of the Bylaws and Missouri law and (b) exclude the Proposals from the Company's proxy materials for the 2006 Shareholders Meeting pursuant to Rule 14a-8 of the Proxy Rules (the "Proxy Rules") under the Securities Exchange Act of 1934, as amended. Please note the laws, rules and governance procedures pertaining to the ability of the Company to decline to bring the Proposals before the 2006 Shareholders Meeting are exclusive of the Proxy Rules and the ability of the Company thereunder to exclude the Proposals from the Company's proxy materials for the 2006 Shareholders Meeting and vice versa. The failure by the Company to state in this Letter any other reason for declining to bring such Proposals before the 2006 Shareholders Meeting does not constitute a waiver thereof.

Proposals under Section 14 of the Bylaws and Missouri Law

For purposes of this Letter, please refer to Section 14 of the Bylaws, a copy of which has been attached hereto as Exhibit B for your convenience. Section 14 of the Bylaws sets forth the technical requirements for the presentation of business at shareholders meetings. The Proposals fail the technical requirements of Section 14 of the Bylaws for the following reasons:

1. The Proposals fail to state the reasons for conducting such business at the 2006 Shareholders Meeting;

2. The address of each Proponent was not included with the Proposals; and

3. There was no indication in the letter as to whether any Proponent has a material interest in such business.

As a result of these failures, the Proposals have not been properly brought before the 2006 Shareholders Meeting pursuant to Section 14 of the Bylaws and the Chairman of the Board, in his discretion, will determine that such business shall not be transacted at the 2006 Shareholders Meeting. The Company invites the Proponents to correct the above listed deficiencies and resubmit the Proposals for consideration; however, such resubmission must be within the time period set forth in Section 14 of the Bylaws.

Please note that even if the technical deficiencies are remedied and the Proposals are resubmitted to the Company in a timely manner pursuant to Section 14 of the Bylaws, the Company believes the Proposal identified in Item 2 on the first page of this Letter is improper under Section 315 of the Missouri General and Business Corporation Law (a copy of which is attached hereto as Exhibit C) and, as a result, the Company, in order to comply with Missouri law, intends to decline to allow such Proposal to be brought before the 2006 Shareholders Meeting.

Proposals under Rule 14a-8 of the Proxy Rules

A. Intent to Exclude Proposals for Failure to Comply with the Proxy Rules.

The Proposals have failed to meet the technical requirements of Rule 14a-8 of the Proxy Rules and, therefore, the Company intends to exclude the Proposals from the Company's proxy materials for the 2006 Shareholders Meeting pursuant to 14a-8. The reasons for exclusion of the Proposals set forth below are mutually exclusive and in no way serve as a waiver of any other reasons for exclusion set forth below. For your convenience, attached hereto as Exhibit D is a copy of Rule 14a-8.

1. Statement Regarding Intent to Hold Requisite Shares Through 2006 Shareholders Meeting.

Rule 14a-8(b) of the Proxy Rules requires that each shareholder submitting a proposal for inclusion in a company's proxy materials affirmatively state its intention to hold the requisite securities through the date of the meeting for which such proposal has been submitted. In light of the fact that the Proponents' Letter fails to state this intention for each Proponent, the Company may exclude the Proposals from its proxy materials for the 2006 Shareholders Meeting. However, the Company invites the Proponents to make the necessary corrections and resubmit the Proposals within the requisite time period discussed below. Should the Proponents decline to accept our invitation to make the necessary corrections in the requisite time period described below, the Company intends to exclude the Proposals under Rule 14a-8.

2. One Proposal Rule.

In light of the fact that the first proposal identified in the Proponents' Letter called for both the Proposals set forth in Items 1 and 2 on the first page of this Letter, we believe that the Proponents have each submitted three shareholder proposals for the 2006 Shareholders Meeting. Rule 14a-8(c) of the Proxy Rules provides that a shareholder may submit no more than one proposal to a company for inclusion in its proxy materials for a particular shareholders meeting. It appears from a clear reading of the Proponents' Letter that the Proposals have been submitted by each Proponent. This is supported by the fact that each Proposal has not been attributed to a single Proponent. Accordingly, the Company believes that each Proponent has exceeded the "one proposal" rule. The Company requests that each Proponent withdraws two of the Proposals to reduce the number of Proposals to one or each individually submits a single proposal. Should the Proponents decline to accept our invitation to make the necessary corrections in the requisite time period described below, the Company intends to exclude two of the Proposals under Rule 14a-8.

B. Responses by Proponents to this Letter.

Under Rule 14a-8(f), the Proponents' responses to this Letter must be post-marked or electronically transmitted within fourteen calendar days from the date you receive this letter (the "Response Period"). If each Proponent does not transmit his/her response or cure the procedural defects (to the extent such defects can be cured) noted above within the Response Period, the Company intends to seek a no-action letter from the Securities and Exchange Commission under Rule 14a-8(j) to exclude the Proposals from the Company's proxy materials.

Please be advised that even if the Proponents cure the defects identified in Sections A. 1 and A.2 of this Letter, the Company intends to submit a no-action request to the Securities and Exchange Commission pursuant to Rule 14a-8(j) seeking to exclude the proposal for potentially one or more reasons set forth in Rule 14a-8(i).

Please contact me at (913) 747-6124 if you have any questions.

Very truly yours,

/s/

H. James Serrone

Enclosures

cc: Victoria R. Westerhaus, Esq.
Robert C. Levy, Esq.

[INQUIRY LETTER]

August 9, 2006

Via Federal Express

Office of Chief Counsel
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F. Street, N.E.
Washington, D.C. 20549

Re: Shareholder Proposal of Basil P. Caloyeras Torotel, Inc.

Dear Ladies and Gentlemen:

The undersigned serves as counsel for Basil P. Caloyeras ("Proponent"), who submitted, on July 21, 2006, a shareholder proposal (the "Proposal") to be voted on at the 2006 Annual Meeting of Shareholders of Torotel, Inc. (the "Company"). By letter dated August 2, 2006, Stinson Morrison Hecker LLP notified the Office of Chief Counsel on behalf of the Company, of the Company's intention to omit the Proposal from its proxy statement and form of proxy for its 2006 Annual Meeting. That letter sought the concurrence of the Staff of the Division of Corporate Finance of the Securities and Exchange Commission with the view that the Proposal is excludable from the proxy statement and form of proxy for the 2006 Annual Meeting.

Proponent will, as permitted by 17 CFR 240.14a-8(k), promptly submit a statement to the Office of the Chief Counsel, responding to the Company's arguments and showing why the Proposal is not excludable by the Company. Prior to the submission of that statement, however, Proponent would make several comments regarding the Proposal and the response of the Company.

First, Proponent is the beneficial owner of 998,066 shares of stock of the Company. His two siblings each are the beneficial owners of 998,067 shares, of which Mr. Caloyeras and his siblings share beneficial ownership with respect to 228,400 shares, which are held by a limited liability company. Therefore, as a group, Mr. Caloyeras and his two siblings beneficially own 2,537,400 shares of the Company's stock, which, prior to July 31, 2006, constituted 49.6% of the 5,111,590 shares then outstanding.

Second, in preparation for the 2005 Annual Meeting of Shareholders, proxies were given to the Proponent, as stated in the Form 8-K, filed by the Company on September 21, 2005, granting the Proponent voting power of a majority of the issued and outstanding shares of stock of the Company.

Third, the Company did not hold an Annual Meeting of Shareholders in 2005. There was no quorum present at the meeting, and consequently, it could not be called to order. No annual meeting of Shareholders has been held since 2004, and in the intervening time period, the Board of Directors has taken the actions outlined in the Proposal, which are contrary to the best interests of the Company and its shareholders and which are sought to be remedied through adoption of the Proposal.

Finally, effective July 31, 2006, the Company entered into an employment agreement with Benjamin Ames, whereby Mr. Ames was employed as Executive Vice President of the Company and received a grant of 200,000 restricted shares of the Company's common stock. Pursuant to the grant, Mr. Ames has full voting power for all the 200,000 shares as of the date of the grant. Upon inquiry, counsel for Proponent was informed that Mr. Ames is a "marketing executive". The grant to Mr. Ames increases the number of outstanding and issued shares of stock of the Company, to 5,311,590, thereby diluting the ownership interest of Proponent and his family, and increasing the number of shares that are required in order for Proponent to receive proxies for a majority of the shares of the Company.

It is Proponent's belief that the grant of restricted shares to Mr. Ames was an excessive amount, set at that amount to dilute the holdings and interests of the Proponent, his family and those who may choose to give proxies to the Proponent for the 2006 Annual Meeting of Shareholders of the Company. The excessive nature of the grant is particularly clear in light of the fact that the beneficial share ownership of the officers and directors of the Company, other than Mr. Ames, are as follows: |[NCCDEF] |[UCA1] |[TDC4,MP1,QL,I4] |[TCC4,M'000.000',QR] |[XT] |[ST]|[LC15]|[RS4]Dale H. Sizemore, Jr., Chairman, President, CEO |[TA]214,779 |[ST]Richard A. Sizemore, Director |[TA]264,995 |[ST]H. James Serrone, Vice President, Finance, Director |[TA]6,916 |[ST]Anthony L. Lewis, Director |[TA]-0- |[ST]Stephen K. Swinton, Director |[TA]-0- |[ET]

In Proponent's response to the Company's letter of August 2, 2006, we will provide our position with regard to the legal issues raised by the Company. However, the actions of the Board of Directors of the Company over the past two years have been directed at entrenching management of the Company and defeating the efforts to enhance shareholder value made by those who had been, prior to the recent actions of the Board, the holders of a majority of the shares of the Company's stock. The Proponent believes that the Proposal is necessary to allow the shareholders to properly exercise their rights and protect their interests.

Very truly yours,

SEIGFREID, BINGHAM, LEVY,
SELZER & GEE, P.C.

/s/

Robert C. Levy

RCL:jh

cc: Victoria R. Westerhaus, Esq.
H. James Serrone
Basil P. Caloyeras

[INQUIRY LETTER]

August 15, 2006

Via Federal Express

Office of Chief Counsel
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F. Street, N.E.
Washington, D.C. 20549

Re: Shareholder Proposal of Basil P. Caloyeras

Dear Ladies and Gentlemen:

As counsel to Basil P. Caloyeras ("Caloyeras"), we submit this letter on our client's behalf in response to the August 2, 2006 letter from Torotel, Inc. (the "Company") requesting that the Division of Corporation Finance (the "Staff") of the Securities and Exchange Commission ("SEC") conclude that no enforcement action will be recommended if the Company omits the Caloyeras shareholder proposal (the "Proposal") from the Company's proxy materials. In its letter to the Staff, the Company asks the Staff to concur with its reasoning for excluding the Proposal from the Company's proxy materials on grounds that the Proposal violates: (1) Rule 14a-8(c), in that the Proposal contains multiple shareholder proposals; (2) Rule 14a-8(e), in that the Proposal was not submitted in a timely manner; (3) Rule 14a-4, in that the Proposal violates certain anti-bundling requirements; and (4) Rule 14a-9, in that the Proposal's supporting statement is false and misleading.

As is more fully explained below, we disagree with the Company's assertions and legal conclusions. Therefore, we respectfully submit that the Company's request for no-action relief be denied. In support of our submission, we assert that: (1) All elements of the Proposal are closely related and essential to a single, well-defined unifying concept and therefore do not constitute multiple proposals; (2) The Proposal was submitted in a timely manner; (3) The Proposal does not violate the anti-bundling requirements of Rule 14a-4; and (4) Staff Legal Bulletin No. 14B (CF) specifically provides it is not appropriate for companies to exclude supporting statement language and/or an entire proposal in reliance on Rule 14a-8(i)(3) in four circumstances, including statements of opinion.

For the purpose of maintaining uniformity with the Company's no-action request letter, when "Rule" is referenced in this letter, it shall mean a rule under Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended.

1. The Proposal Is a Single Proposal in Accordance with Rule 14a-8(c) and SEC Release No. 34-12999 (November 22, 1976).

Rule 14a-8(c) permits each shareholder of a company to submit one shareholder proposal for consideration at a particular shareholder's meeting. The Staff has stated that Rule 14a-8(c) was not intended to prevent single proposals with multiple elements from being included in proxy materials. Moreover, the Staff has consistently stated that a proposal containing multiple elements will be considered a single proposal under Rule 14a-8(c) when all elements relate to a single issue. SEC Release No. 34-12999 (November 22, 1976) (A single proposal made up of several components does not constitute more than one proposal if the components "are closely related and essential to a single well-defined unifying concept."). The Proposal submitted by Caloyeras had at its single purpose to remedy the recent actions of the Board of Directors of the Company, in which it acted to entrench itself and obtain excessive control over the Company's decision making and resources at the expense of the Company and its shareholders.

The Company asserts that the July 5, 2005 notice, as submitted to the Company on July 21, 2006, is a mere "bundling and revision of the proposals in the July 5^thProposal Letter." The Company further suggests the Proposal consists of a "single resolution proposing two distinct amendments to the company's Articles of Incorporation."

A portion of the July 5^th letter referenced by the Company is copied below for your convenience:

1. Eliminate the staggered terms of the Board of Directors, effective immediately. All terms of all directors will expire at the annual meeting on September 18, 2006; and

2. No amendment to Torotel's Bylaws may be made without the approval of a majority of the shareholders of Torotel.

On receipt of the July 5, 2006 letter, the Company, on July 18, 2006, responded with a notification of deficiency, which it sent to Caloyeras, as required by Rule 14a-8(f). In response, Caloyeras submitted the Proposal on July 21, 2006 (1) in accordance with the Company's direction and pursuant to the Bylaws of the Company, which were amended and restated on June 30, 2006, after the submission of the July 5^thletter and presumably in response to that letter, (2) in compliance with Rule 14a-8(c); and (3) pursuant to SEC Release No. 34-12999 (November 22, 1976).

The July 21, 2006 Proposal is copied below:

Article Six:

Article Nine:

"Only a majority of Shareholders may make, alter, amend, suspend or repeal the Bylaws. With respect to the Bylaws currently in effect, each of the following provisions is hereby revoked in its entirety: Article II, Sections 13, 14, and 15; Article III, Sections 2, 8, and 10; and Article XIII. Article II, Section 2 shall be amended to read that a special meeting of Shareholders may be called by the President, Board of Directors or Shareholder holding not less than 15% of outstanding shares of the Corporation."

The Company suggests that a plain reading of the Proposal evidences "no single, unifying concept among the various proposals contained." Further, the Company requests the Staff to find that the Proposal is a mere "bundling and revision of the proposals in the July 5^thProposal Letter." According to the Company, the Proposal consists of a "single resolution proposing two distinct amendments to the company's Articles of Incorporation." In support thereof, the Company cites to certain SEC no-action letters , wherein the Staff determined the proposals consisted of multiple components/elements inconsistent with a single well-defined concept. Contrary to the Company's assertions, however, these letters are unmistakably distinguishable from the issues here.

We submit that the Proposal was to remedy the recent actions of the Board of Director to entrench themselves and obtain excessive control over the Company's decision making and resources at the expense of the Company and its shareholders. As such, the Proposal is one proposal, because it contains a single well-defined concept not present in the proposals noted by the Company. In the following letters, the Staff concluded that each proposal consisting of multiple elements was one proposal, that each element was logically necessary to achieve the purpose and/or goals of such proposal, and therefore, constituted one proposal with a single, unifying concept:

1.) Quality Systems, Inc. (June 9, 1999) (Five subcomponents all related to creating a more independent board of directors. The Staff concluded the proposal was a single proposal under Rule 14a-8(c), because all five elements related to the creation of an independent board of directors. The proposal sought shareholder approval to amend the bylaws to include the following: (1) at least seventy-five percent (75%) of the directors on the board be independent directors; (2) the independent directors of the board meet in executive session, separately from the other directors, at the end of each meeting of the board to discuss such matters as they deem appropriate: (3) the independent directors shall elect the chairman of the board; (4) the chairman of the board be required to be an independent director; and (5) a nominating committee be established);

2.) AT & T (April 10, 2002) (Five subcomponents; including that when shareholder approval for any future restructuring results in the creation of a new corporation, shareholders will vote separately on whether the corporation will (1) have a classified board of directors; (2) eliminate the right of shareholders to act by written consent or impose a requirement that a larger number of consents be delivered than required under state law; (3) eliminate the right to call a special meeting or impose a requirement that a larger percentage of shareholders demand such a meeting than required by state law; (4) require approval of more than a majority of shareholders to amend some or all provisions of the charter; and (5) require approval of more than a majority of shareholders to amend some or all bylaws. See Section 3 of our letter herein);

3.) Westinghouse Electric (January 27, 1995) (Three subcomponents: (1) that a majority of GE's Board of Directors be required to consist of "independent" directors; (2) that the Board appoint a committee consisting of the current independent directors to oversee implementation of the first proposal; and (3) that the Board submit to a shareholder vote "as a separate proposal" and "future action" to modify the first or second proposals);

4.) Ferrofluidics Corp. (September 18, 1992) (Proposal upheld where all elements were related to base pay and warrants granted to executives).

Notably, the foregoing proposals contained multiple subcomponents distinctly related to one single, unified concept and, therefore, one proposal. The compendium of cases on the issue here favors a similar conclusion with respect to the Proposal submitted by Caloyeras. The Proposal is one course of action with a singular purposea response to the current Board of Director's distinct actions to entrench the Board with power to obtain excessive control over the Company's decision making and resources, all designed to limit the ability of the Company's shareholders to undertake corporate actions.

For the foregoing reasons, the Company's argument that the Proposal constitutes multiple proposals should be rejected.

2. The Proposal Is Not Excludable as Untimely Pursuant to Rule 14a-8(e)(2).

The Company seeks to exclude the Proposal submitted by Caloyeras contending the Proposal was untimely and excludable in reliance on Rule 14a-8(e) (2). For the reasons that follow, we request that the Staff recommend enforcement action if the Company omits the Proposal from its proxy materials in reliance on Rule 14a-8(e)(2).

Rule 14a-8(e)(2) provides that, in order to meet the deadline for submitting proposals, a shareholder proposal must be received at the company's principal executive offices not less than 120 calendar days before the date of the company's proxy statement released to shareholders in connection with the previous year's annual meeting. Further, Rule 14a-8(e)(2) provides an exception to this timing requirement. If the annual meeting was not held the previous year, or the date of the annual meeting has been changed by more than 30 days from the date of the previous year's meeting, the deadline for submitting a proposal is a reasonable time before the company begins to print and mail its proxy materials.

The Proposal should be excepted from the 120-day rule requirement, because the 2005 annual meeting of the Company was not held. The meeting was called to order, opening remarks were made by the Chairman of the meeting, the directors and officers were introduced, and there was proof of notice of the meeting and a report on quorum (according to the Agenda of the Annual Meeting of Shareholders dated Monday, September 19, 2005). Immediately thereafter, however, the Chairman declared Caloyeras and the holders of proxies representing a majority of the issued and outstanding shares out of order, when they attempted to submit matters for consideration by the shareholders. In response, Caloyeras and his family announced they were not submitting their votes (nor any proxies that they were holding) and a quorum would not be present.

Under Missouri law, a quorum must be present for any action taken at a meeting to constitute a valid action of shareholders. Mo. Rev. Stat. §351.265 (1996). Because no quorum was present, no business was transacted at what the Company contends was an annual meeting of the shareholders on September 19, 2005. A valid meeting, particularly important for publicly held companies to competently govern under the guidelines of the Sarbanes-Oxley Act, requires far more than merely calling a meeting to order and introducing directors and officers.

The Staff's Legal Bulletin No. 14 provides guidance on Rule 14a-8, by stating that this Rule is an avenue for shareholders and companies to communicate and "generally requires companies to include the proposal unless the shareholder has not complied with the Rule's procedural requirements." Consistent with the Staff's interpretation and application of Rule 14a-8, any conclusion that a Company's annual meeting took place on September 19, 2005 would elevate form over substance. Although confusion may have taken place on September 19, 2005, any confusion among those present does not translate into a duly held meeting where any business was transacted. Therefore, the September 19, 2005 "meeting" should not be considered as to exclude the timely submitted Proposal.

We also note that no shareholder meeting was held in 2004, meaning no shareholder meeting has been held since September 2003. In addition to evidencing bad corporate governance generally, we believe this is consistent with the Company's aim to limit shareholder participation in corporate governance.

The Proposal was submitted within a "reasonable time" and before the Company began "printing and mailing" its proxy materials. The Proposal was originally submitted to the Company on July 21, 2006. The Company has informed us that it expects to mail its proxy materials in mid-August (for purposes of this response, we assume a date of August 15, 2006). Based on this premise, the Proposal was sent 41 days before the Company planned to print and mail its proxy materials.

In determining whether a proposal is made within a reasonable time, the fundamental consideration is whether at the time the proposal is submitted, it affords the company reasonable time to consider the proposal without causing excessive delay in the distribution of proxy materials to its shareholders. Jefferson-Pilot Corporation (January 30, 2006); Greyhound Lines, Inc. (January 8, 1999). In Jefferson-Pilot, the company was holding a special meeting. Rule 14a-8 (e) (3) states that a shareholder proposal submitted for a meeting other than a regularly scheduled annual meeting should be submitted, "a reasonable time before the company begins to print and mail its proxy materials," the same deadline imposed when an annual meeting was not held the previous year. The proponent of the proposal in Jefferson-Pilot submitted the proposal to the company on January 17, 2006, only 22 days before the company planned to print and mail its proxy materials. In this instance, the Staff found some basis for Jefferson-Pilot's view that the proposal was not timely submitted in accord with Rule 14a-8(e)(3).

The decision in Jefferson Pilot should be contrasted with the decision regarding the no-action letter in U.S. Liquids, Inc. (April 3, 2002). In U.S. Liquids, the date of the annual meeting was changed from July 10, 2001 to May 14, 2002, triggering the reasonable time requirements in Rule 14a-8(e)(2). A proposal dated March 5, 2002 was received by the company on March 11, 2002 and the company planned to print and mail its proxy materials approximately on April 12, 2002. Therefore the company had approximately 32 days from the date the proposal was received (March 11, 2002) to the date the company planned on printing and mailing its proxy materials (April 12, 2002). The Staff determined that the proposal should be included under Rule 14a-8 (e)(2).

In Avaya, Inc. (December 4, 2001) the company did not hold an annual meeting because of a stock split off from Lucent Technologies. The proposal was received by Avaya on October 1, 2001, 31 days after the August 31, 2001 deadline the company disclosed in its Quarterly Report on Form 10-Q. However, the proposal was received 99 days before the company planned to file and mail its definitive proxy materials. The Staff was also unable to concur in Avaya's view that the proposal should be excluded under Rule 14a-8(e)(2).

The Proposal did not give the Company 99 days to consider it; however, the Company had 41 days for consideration. In U.S. Liquids, 32 days was deemed enough time to consider the proposal. The Caloyeras Proposal exceeded that. In Jefferson-Pilot, the company had only 22 days to consider the proposal. Caloyeras provided the Company nearly twice that amount of time to consider his Proposal.

Additionally, a series of no-action letters have consistently stated that the Staff will not recommend enforcement action against a registrant that excluded a shareholder proposal received after the registrant filed its preliminary proxy materials. See Scudder New Europe Fund (November 10, 1998) and Public Service Company of Colorado (November 29, 1995). The Company has not filed preliminary proxy materials. Therefore, there is no reason to exclude the Proposal based on Caloyeras' timeliness with regard to the Company's filing of any preliminary materials.

Therefore, we respectfully request that the SEC recommend enforcement action if the Company omits the Proposal from its proxy materials for the 2006 annual meeting in reliance on Rule 14a-8(e)(2).

3. The Proposal Does Not Violate the Anti-Bundling Requirements in Rule 14a-4(a)(3).

The Staff has consistently denied granting no-action relief where proposals contain elements relating to the same subject even when the elements are distinct and require separate corporate action. In Ametek, Inc. (February 15, 1994), the Staff rejected the company's argument that the proposal consisted of three or more distinct proposals and three corporate actions (the proposal sought to reconstitute its board of directors, require that two-thirds of the directors be independent, create independent nomination and compensation committees, and diversify the board by expertise, gender, and race); Westinghouse Electric Corporation (January 27, 1995) (similar conclusion). In Ferrofluidics Corporation (September 18, 1992), the Staff concluded that a proposal containing six different elements requiring individual corporate actions did not violate the rule. The six components dealt with base salary, executive loans, incentive compensation, the terms and number of stock options and stock repricing. The Staff determined that all components related to "controlling executive compensation."

The proposal in the letters the Company cites are distinguishable from the Proposal and the facts at hand. For example, in Fotoball, Inc. (May 6, 1997), the Staff rejected the proponent's characterization of the proposal as related to "director qualifications" where the proposal requested the company to impose a director stock ownership requirement, pay directors solely in stock, and impose an independence requirement. The Staff's conclusion is logical in view that qualifications and compensation are distinctly separate, unrelated components; Delta Air Lines, Inc. (July 9, 1993) (proposal sought resignation of the CEO, separation of the CEO and Chairman positions, creation of four employee directorships on the board, requested independent study regarding the Pan Am acquisition and sought creation of a policy regarding executive compensation); Allstate Corporation (January 29, 1997) (The Staff permitted exclusion of a proposal requesting the board to adopt cumulative voting, prohibit classification of the board, reduce the board size or "manipulation of company shares that has the effect of diminishing the cumulative voting rights of the companies [sic] stockholders."). In Global Entertainment Holdings/Equities, Inc. (July 18, 2003), the proponent submitted five proposals related to increasing the number of board nominees and nominee qualifications, including (1) amendment to bylaws to require a 2/3 vote of shareholders for future changes to bylaws, (2) amendment to title of the bylaws, (3) amendment to stockholder and special meetings articles with limitations regarding calling of special meetings of stockholders; (4) amendment relating to Board of Directors, number and qualifications, and (5) amendment relating to Officers; Election and Tenure, both of which provided more stringent qualifications). Also, in Exxon Mobil Corp. (March 19, 2002), two separate proposals were identical to proposals submitted by shareholders at the prior year's annual meeting; proposals to (1) to increase diversity of the Board and (2) to nominate more candidates than open Board seats. The company submitted evidence that both proposals were "overwhelmingly defeated" at the prior annual meeting, the holder of more than twice as many shares favoring the proposal regarding Board diversity than the proposal regarding additional director nominees.

The Company's reliance on those cases is misplaced. The Company misunderstands the Staff's clear guidance and interpretive instruction concerning multiple issues related to a single concept. The Company suggests the Proposal contains separate and distinct provisions. Specifically, the Company asserts that a shareholder might wish to vote for one without being forced to vote for the other. In its own words, the Company suggests "a shareholder may wish to reduce the number of directors to five, but may desire to continue to allow the board of directors to have equal power to amend the bylaws." According to the Company, the shareholder's voting proposal would be restricted by the combination of the two proposals. Additionally, the Company suggests shareholders may want power to amend the bylaws, but may not agree that shareholders holding 15% or more of the Company's outstanding shares have the ability to call a special meeting.

The Staff considered a similar argument in AT&T (April 10, 2002). There, the Staff concluded that AT&T could not exclude the proposal under Rule 14a-8(c). Despite AT&T's urging that the proposal violated the "anti-bundling" rule, the Staff noted that the proposal's focus on presenting separate matters to shareholder vote in an "unbundled manner" was a response to recent AT&T proxy materials referenced in the supporting statement. The five proposals were as follows:

1. "RESOLVED: Shareholders of AT&T Corp. ("AT&T) urge the Board of Directors to adopt a policy that when AT&T seeks shareholder approval for any future restructuring resulting in the creation of a new corporation by AT&T, shareholders will be given the opportunity to vote separately on whether the new corporation will... [h]ave a classified board of directors:

2. RESOLVED: Shareholders of AT&T Corp. ("AT&T") urge the Board of Directors to adopt a policy that when AT&T seeks shareholder approval for any future restructuring resulting in the creation of a new corporation by AT&T, shareholders will be given the opportunity to vote separately on whether the new corporation will... [e]liminate the right of shareholders to act by written consent or impose a requirement that a larger number of consents be delivered than required under state law;

3. RESOLVED: Shareholders of AT&T Corp. ("AT&T") urge the Board of Directors to adopt a policy that when AT&T seeks shareholder approval for any future restructuring resulting in the creation of a new corporation by AT&T, shareholders will be given the opportunity to vote separately on whether the new corporation will [e]liminate the right of shareholders to call a special meeting or impose a requirement that a larger percentage of shareholders demand such a meeting than required under state law;

4. RESOLVED: Shareholders of AT&T Corp. ("AT&T") urge the Board of Directors to adopt a policy that when AT&T seeks shareholder approval for any future restructuring resulting in the creation of a new corporation by AT&T, shareholders will be given the opportunity to vote separately on whether the new corporation will... [r]equire approval of more than a majority of shareholders to amend some or all provisions of the charter;

5. RESOLVED: Shareholders of AT&T Corp. ("AT&T") urge the Board of Directors to adopt a policy that when AT&T seeks shareholder approval for any future restructuring resulting in the creation of a new corporation by AT&T, shareholders will be given the opportunity to vote separately on whether the new corporation will... [r]equire approval of more than a majority of shareholders to amend some or all bylaws.

Similar to AT&T, the Proposal was a single response to Company action. Caloyeras believes the Proposal does not violate the anti-bundling requirements of Rule 14a-4(a)(3). First, it is important to note the components the Company identifies as separate and distinct are somewhat analogous to spokes originating from one hub. Here, the single concept, or hub, is the shareholder's right to participate in amending the bylaws, articles, etc. The number of directors on the board, as well as the number of shares needed to call a special meeting, borrow its power from the resolution permitting shareholders the right to amend bylaws, etc. The result would not change even if all subcomponents were removed excepting for the shareholder voting right. The subcomponents are derivative of a single concept and common to one purposethe right of shareholders to restrain the power of the Board at shareholder's expense. Caloyeras has proposed that the Amended and Restated Bylaws of the Company be returned to their state prior to the Board of Directors' recent action.

Finally, pursuant to Rule 14a-8(i)(8), implementing the Proposal would not disqualify directors previously elected from completing their terms on the board or disqualify nominees for directors at the upcoming shareholder meeting. The Proposal does not affect the unexpired terms of directors presently elected to the board at or prior to the upcoming shareholder meeting.

3. The Supporting Statement Contained in the Proposal Does Not Contain False or Misleading Statements in Violation of Rule 14a-9 or the Standards Set Forth in Staff Legal Bulletin No. 148 (CF).

The purpose of Rule 14a-8(i)(3) is to allow exclusion where the proposal as a whole cannot be understood. That concern is not present under these circumstances. Pursuant to Staff Legal Bulletin No. 14B (CF), it is not appropriate for companies to exclude supporting statement language and/or an entire proposal in reliance on Rule 14a-8(i)(3) in the following circumstances:

The company objects to factual assertions because they are not supported;

The company objects to factual assertions that, while not materially false or misleading, may be disputed or countered;

The company objects to factual assertions because those assertions may be interpreted by shareholders in a manner that is unfavorable to the company, its directors, or its officers; and/or

The company objects to statements because they represent the opinion of the shareholder proponent or a referenced source, but the statements are not identified specifically as such.

The Staff has provided clear guidance on this issue. Statements consistent with these guidelines will not be used to exclude the Proposal. Staff Legal Bulletin No. 14B (CF) clearly authorizes shareholder opinions not specifically identified as "opinion," and such opinions will not be excluded under 14a-8(i)(3).

A. Caloyeras' Statements of Opinion that the Amended and Restated Bylaws Suggest a Plan to Retain Excessive Control Are Neither False Nor Misleading.

The Company objects to Caloyeras' statement, "[t]he new Bylaws are part of an overall plan by the current Board and management to retain excessive control of the Corporation at the shareholder's expense." The Company places emphasis on the word "plan" and contends the statement is one of fact and constitutes "nothing more than an attempt to impugn the character of the board of directors in violation of Rule 14a-9."

Caloyeras' statement falls within the scope of permissible statements, as it is a statement of opinion. A proposal setting forth an opinion regarding the Board's June 30, 2006 amendment to the Bylaws without notice to the shareholders is neither false nor misleading. The information is readily ascertainable to other shareholders. Individual shareholder opinion concerning amendments affecting shareholder rights, including an opinion that the board plans to retain excessive control, is not false or misleading. In its request for no-action to the Staff, the Company acknowledges its purpose for changing the Bylaws. The Company admitted its purpose in its no-action request, stating that "the board of directors believed it was necessary and consistent with its fiduciary duties to protect minority shareholders from possible actions that could be taken by majority shareholders that would not be in the best interests of all shareholders."

B. Caloyeras' Statements of Opinion Relating to Shareholder Concerns about the Board's Performance and/or Employment Agreement Are Neither False Nor Misleading.

The Company objects to the Proposal's statement that "[t]he current Board has performed poorly compared to boards of similarly situated corporations, has failed to respond adequately to shareholder concerns and has voted in favor of employment agreements featuring poor pay-performance links." The Company asserts that the statement is an unsupported assertion of fact, with no comparative analysis of similarly situated companies' boards of directors, etc. In substance, this statement is opinion. The opinion is neither false nor misleading. The Board voted in favor of employment agreements that provide for substantial compensation on termination with or without cause. An opinion to performance is within a shareholder's personal experience. Other shareholders would not be misled by such a statement.

In addition, Caloyeras included his statements of opinion to satisfy the addition of new Section 14 to the Bylaws that Caloyeras is proposing to have removed, which states in Section 14 that for any business to be properly brought before a meeting of shareholders of the Company, the shareholder shall set forth as to each matter the shareholder proposes to bring before the meeting a brief description of the business and the reasons for conducting such business at the meeting. In submitting the comments to which the Company is now objecting, Caloyeras was only attempting to comply with the Company's own rules. In fact, the Company must have anticipated the unenforceability of this new Bylaw addition, as it concludes with the statement that "[t]o the extent this Section 14 shall be deemed by the Board of Directors or the Securities and Exchange Commission, or finally adjudged by a court of competent jurisdiction, to be inconsistent with the right of shareholders to request inclusion of a proposal in the Corporation's proxy statement pursuant to Rule 14a-8 promulgated under the Exchange Act, such rule shall prevail."

CONCLUSION

For all the reasons contained herein, on behalf of Caloyeras, we respectfully request that the Staff find the Company's arguments inconsistent with the Staff's interpretations and rulings on this issue and therefore deny the Company's request for no-action relief. We request that the Staff deliver its response to this letter by U.S. first class mail and by facsimile to the number on the first page of this letter.

Very truly yours,

SEIGFREID, BINGHAM, LEVY, SELZER & GEE, P.C.

/s/

Robert C. Levy

cc: Secretary, Torotel, Inc., 620 N. Lindenwood Drive, Olathe, KS 66062 (via hand delivery)
Victoria Westerhaus, Esq. (via hand delivery)
Howard Z. Berman, Esq. (via e-mail)
Mr. Basil P. Caloyeras (via e-mail)

[INQUIRY LETTER]

August 23, 2006

Office of Chief Counsel
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549

Re: Response of Torotel, Inc. to that Certain Response Letter Regarding the Exclusion of Shareholder Proposal

Ladies and Gentlemen:

On August 2, 2006, Torotel, Inc., a Missouri corporation (the "Company"), submitted a letter (the "Initial Letter") to the Division of Corporation Finance (the "Division") of the Securities and Exchange Commission (the "Commission") requesting that the staff of the Commission (the "Staff") concur with the Company's view that the Company was entitled to omit from its proxy statement and form of proxy for its 2006 Annual Meeting of Shareholders (collectively, the "2006 Proxy Materials") a shareholder proposal (the "Proposal") and statements in support thereof received from Basil P. Caloyeras (the "Proponent").

In response to the Initial Letter, the Proponent delivered to the Division a letter, dated August 15, 2006 (the "Response Letter"), pursuant to which the Proponent asserted its opposition to the exclusion of the Proposal. Although we believe the Initial Letter already addresses most of the arguments raised by the Proponent, we are providing the Staff with this letter in order to clarify the Company's position with respect to certain issues raised by the Proponent.

I. Preliminary Matter.

As a preliminary matter, we would like to inform the Staff that we believe the Proponent misrepresented the facts regarding the 2005 Annual Meeting of the Company's Shareholders (the "2005 Annual Meeting"). The 2005 Annual Meeting was held in accordance with Missouri law as we stated in the Initial Letter. The Proponent (through his counsel) responded to the Initial Letter by delivering to the Commission the Response Letter and a letter that preceded it dated August 9, 2006 (the "August 9 Letter"). The August 9 Letter stated, "... the Company did not hold an Annual Meeting of Shareholders in 2005." It further stated, "[t]here was no quorum present at the meeting, and consequently, it could not be called to order." Both the Proponent and his counsel were present at the 2005 Annual Meeting. The Proponent's shares (and those for which he held a proxy) were tendered to be counted as present for the 2005 Annual Meeting and the Proponent and his counsel witnessed UMB Bank, n.a., the inspector of elections for the 2005 Annual Meeting, certify to the Company's Secretary that a majority of the outstanding shares were present in person or by proxy and that a quorum was satisfied. Immediately, the Chairman called the meeting to order. Neither the Proponent nor his counsel disputed that a quorum was present and that the 2005 Annual Meeting had started. In fact, counsel to the Proponent, once he knew that a quorum was certified and the meeting was called to order, attempted to bring business before the meeting that had not been properly presented in accordance with the advance notice provisions for submission of shareholder proposals. After being ruled out of order by the Chairman for failing to comply with the advance notice requirements, the Proponent and his counsel voluntarily left the meeting. We would be happy to make available to the Commission, upon its request, a copy of the transcript from the audio recording of the 2005 Annual Meeting.

Following receipt of the August 9 Letter, we contacted counsel to the Proponent by telephone. The purpose of the telephone call was to remind him that the 2005 Annual Meeting had been tape recorded with the knowledge of all participants. We had no obligation to remind him about the audio recording prior to his delivery of the Response Letter; we informed him out of professional courtesy.

II. The Proposal May Be Excluded as Untimely.

The Company clearly explained in the Initial Letter that the Proposal was delivered in an untimely manner in violation of Rule 14a-8(e) and, therefore, may be excluded. The Response Letter fails in its arguments to the contrary.

A. The 2005 Annual Meeting Was Held in Accordance with Missouri Law.

The 2005 Annual Meeting was held in accordance with Missouri law. As the Minutes of the 2005 Annual Meeting (the "2005 Minutes" a copy of which we would be happy to provide to the Commission upon its request) indicate, UMB Bank, n.a., the inspector of elections for the 2005 Annual Meeting, certified that a majority of the shares of the Company were present, in person or by proxy, at the meeting and, thus, a quorum was present. The Company's Secretary concurred with this certification and, thereafter, the Chairman called the 2005 Annual Meeting to order. As stated previously, the Proponent and his counsel attempted to bring business before the meeting that had not been properly submitted in accordance with the Company's advance notice requirements for shareholder proposals. After being ruled out of order, the Proponent and his counsel took it upon themselves to leave the 2005 Annual Meeting. As we previously indicated in the Initial Letter, the meeting was adjourned, but never reconvened.

The 2005 Annual Meeting was held in accordance with Missouri law. The Proponent fails to accurately describe Section 351.265 of the Missouri General and Business Corporation Law (the "MGBCL") in the Response Letter. For your convenience, we have attached Section 351.265 as Exhibit A hereto.

Subsection (1) of Section 351.265 states that "[u]nless otherwise provided in the articles of incorporation or bylaws, a majority of the outstanding shares entitled to vote at any meeting, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders." Subsection (2) of Section 351.265 provides that for any action to be valid, it must have received the vote of a majority of shares entitled to vote at a meeting where a quorum was present. Therefore, to have a valid meeting, there must be a quorum and, to have a valid action (shareholder vote), a majority of the shares entitled to vote must have approved such action. A quorum was present for the 2005 Annual Meeting and the meeting was called to order. Therefore, under Missouri law, the 2005 Annual Meeting was held. The fact that the Proponent and his counsel left and that the meeting was adjourned is irrelevant under Missouri law. Missouri law is clear in this regard and this clarity is further evidenced by the fact that the Proponent is unable to proffer any statutory or common law in Missouri to the contrary.

The Response Letter states that there was no "substance" to the 2005 Annual Meeting and, therefore, it did not take place. The Proponent offers no Missouri statutory or common law to support this assertion. The Proponent suggests the premise that anytime a shareholder voluntarily leaves a meeting and, as a result, a quorum ceases to be present, the meeting is no longer valid. As a general matter, commentators, including one of the preeminent commentators on general corporate law, disagree with this suggestion.¹ More specifically, although Missouri courts have never addressed this specific issue in the context of a for-profit corporation, one Missouri court did address the situation in the not-for-profit corporation context. In Potter, et al v. Patee, et al.², the Court of Appeals for the Kansas City District applied this general principle and cited a Pennsylvania corporate law case in support of this position. It is clear the Proponent lacks any factual or legal basis for its assertion that the 2005 Annual Meeting was not a valid meeting.

We understand the Commission is not the arbiter of state law corporate governance issues; however, as part of a suitable reply to the Response Letter, we felt it necessary to provide clarity on Missouri corporate law. There can be no doubt that the 2005 Annual Meeting was held: proxy materials were distributed to shareholders, proxy cards were received, a majority of the shares were present in person or by proxy (a "quorum"), the meeting was called to order and the first matter the Chairman had to tend to was dealing with the out of order actions of the Proponent and his counsel. It is disingenuous of the Proponent to suggest the 2005 Annual Meeting did not have "substance" and thus did not take place, because they did not follow the advance notice procedures that applied to all shareholders, had their business ruled out of order and took it upon themselves to leave in an effort to stop the 2005 Annual Meeting.

B. Forty-One Days Prior to Mailing Does Not Constitute a "Reasonable Time" .

The Proponent claims in the Response Letter that delivery of the Proposal "41 days" prior to the mailing of the 2006 Proxy Materials meets the "reasonable time" standard of Rule 14a-8(e)(2) (assuming for purposes of argument the 2005 Annual Meeting had not been held). For the reasons set forth below, this belief is erroneous.

As a preliminary matter, we review the general information available to all shareholders regarding the dates of the 2006 Annual Meeting and relevant deadlines for submission of shareholder proposals. As we stated in the Initial Letter, the 2005 Proxy Materials (as such term is defined in the Initial Letter) set forth the deadline (April 21, 2006) for shareholder proposals to be submitted for inclusion in the 2006 Proxy Materials. Section 351.225 of the MGBCL requires that the day of a Missouri corporation's annual meeting be set in its bylaws. The Company is and has been compliant with this requirement. Since the delivery of the 2005 Proxy Materials, the Company has not changed the day of the annual meeting. All shareholders have been aware of the day of the Company's annual meeting. Furthermore, the Company has never given any indication that the day of the annual meeting might be changed. Therefore, the Proponent had no reasonable basis from which to conclude that the 2006 Annual Meeting might not be held on the normal day for annual meetings under the Company's Bylaws and, therefore, the Proponent had no reasonable basis to believe that the deadlines set forth in the 2005 Proxy Materials were no longer valid.

The Proxy Rules provide that 120 days prior to the date on which the prior year's proxy materials were mailed is the proper deadline for submission of proposals for the current year's proxy materials. This allows a 40-day window within which a company may notify a shareholder of any deficiencies with his/her proposal and for such shareholder to correct such deficiencies. The Proxy Rules require that a company submit a no action request to the Commission at least 80 days prior to mailing its proxy materials if it intends to exclude a shareholder proposal. This 80-day window is intended to allow a proper amount of time for review of the no action request, such that the mailing date of the proxy materials will not be delayed. Assuming a shareholder's proposal is not excludable, under the Proxy Rules, a company must deliver to the shareholder a copy of his/her proposal and the company's response thereto, as they will appear in the proxy materials. This allows the shareholder an opportunity to raise with the Commission any issues of material misrepresentation in the company's response.

In light of the fact that (i) the Proponent, a sophisticated businessman advised by experienced counsel, should be familiar with the Proxy Rules (and the deadlines mandated thereby), (ii) the deadlines for submission of shareholder proposals were clearly detailed in the 2005 Proxy Materials and (iii) no changes have been made to the Company's annual meeting date (which has and is required by Missouri law to be included in the Company's Bylaws), the delivery of the Proposal 41 days prior to the Company's intended mailing date is clearly unreasonable. Even with the Proponent's flawed assumption that the 2005 Annual Meeting was not held, the Proponent was well aware of all relevant deadlines and the date for the 2006 Annual Meeting. Furthermore, the Proponent should have been aware that by submitting the Proposal so late, the Company's ability to properly contest the inclusion of the Proposal in the 2006 Proxy Materials and mail such materials on time would be compromised. As we stated in the Initial Letter, the Company intended to mail the 2006 Proxy Materials on or about August 18, 2006 and, as a result of the Proponent's untimely submission and the resulting no action letter process, the Company has failed to meet this date. The Company has not moved the 2006 Annual Meeting date.

As we stated in the Initial Letter, the Proposal was not submitted in a reasonable time pursuant to Rule 14a-8(e)(2). The analysis contained in the Initial Letter and the no action letter issued with respect to Jefferson-Pilot Corporation (January 30, 2006) are determinative on this issue. The Proponent asserts several no action letters in support of his contention that the Proposal was submitted in accordance with Rule 14a-8(e)(2); however, none of these no action letters are applicable to the case at hand.

U.S. Liquids, Inc. (April 3, 2002) is inapplicable because the situation involved U.S. Liquids moving the date of the current year's annual meeting up by more than 30 days. U.S. Liquids did not inform the shareholders of this advancement in the annual meeting date until only three months prior to the annual meeting. By shortening the amount of time a shareholder had to consider and submit a proposal (because of an earlier annual meeting date), U.S. Liquids had effectively put the shareholders at a disadvantage. None of the facts present in U.S. Liquids is present in this case; specifically, the annual meeting date has not changed and there has been no indication that it would have been changed to an earlier date. Furthermore, the time frame in which the Proponent had to consider and submit the Proposal was never shortened.

Avaya, Inc. (December 4, 2001) is also inapplicable to the case at hand. Avaya received the shareholder proposal 99 days prior to the mailing date for Avaya's proxy materials. This date was well outside the 80-day deadline for Avaya to submit a no action letter seeking to exclude the shareholder's proposal. Therefore, Avaya would have been able to go through the process to exclude the shareholder's proposal in ample time prior to the mailing of its proxy materials. This is the opposite of the present case. The Proponent submitted the Proposal significantly inside the 80 day no action deadline and in less than half the time the shareholder in Avaya submitted the contested proposal. For the foregoing reasons, reliance on Avaya is misplaced.

Finally, the Proponent asserts that so long as preliminary proxy materials have not been filed with the Commission, then the Proposal is timely. This conclusion is the poor attempt at arguing in the negative the Commission's holdings in Scudder New Europe Fund (November 10, 1998) and Public Service Company of Colorado (November 29, 1995) that the relevant shareholder proposals were untimely because they were submitted after the preliminary proxy materials had been filed with the Commission. We are unaware of any no action letter ruling by the Commission holding that shareholder proposals are timely solely on the basis that a shareholder submits a proposal before a company files its preliminary proxy materials. We believe the Proponent incorrectly expanded the holdings of the Scudder and Public Service.

III. The Proposal May Be Excluded Pursuant to Rule 14a-8(c) Because the Proposal Constitutes Multiple Proposals.

The Company clearly explained in the Initial Letter that the Proposal contains more than one proposal in violation of Rule 14a-8(c). The Response Letter fails in its arguments to the contrary.

The Proponent states in the Response Letter that the single "purpose" of the Proposal and its subparts is "to remedy the recent actions of the Board of Directors of the Company, in which it acted to entrench itself and obtain excessive control over the Company's decision making and resources at the expense of the Company and its shareholders." Before we discuss no action letter precedent, we would like to make several points.

First, we would like to reiterate the fact that the July 5th Letter (as defined in the Initial Letter) contained multiple "items... for presentation at the 2006 annual meeting of Torotel." After receipt of the Deficiency Letter (as defined in the Initial Letter) from the Company, the Proponent re-submitted the "items" as the Proposal. From a clear reading of the July 5th Letter, it is apparent the Proponent clearly viewed the "items" as separate and distinct, otherwise he would have only submitted one "item" containing both "items".

Second, as the Staff will note, the Proposal's supporting statement identifies multiple purposes for the Proposal, not "one single, well-defined unifying concept." The Proposal's supporting statement and the introduction to the resolutions states the amendments to the Company's Articles are made to remove certain provisions of the Bylaws that restrict shareholder rights and decrease shareholder value. Furthermore, the Proposal's supporting statement identifies several other purposes, including more effective corporate governance and reduced expenses as a result of a smaller Board of Directors. These are inconsistent with the "purpose" asserted in the Response Letter. Clearly there is no "one single, well-defined unifying concept" linking the multiple proposals within the Proposal.

Third, with respect to the statement that the Board of Directors acted to "obtain excessive control over the Company's decision making and resources", Proponent obviously fails to understand that the Board of Directors cannot obtain any more "control" than what it has always had, which is granted under Section 351.310 of the MGBCL. Section 351.310 states that "[t]he property and business of a corporation shall be controlled and managed by the board of directors." The Proposal does not propose to amend the powers granted to the Board of Directors under Section 351.310, nor could it alter those powers, and, thereby, reduce the control of the Board of Directors over the Company's decision making and its resources. Thus, the Proposal is inconsistent with the "purpose" stated in the Response Letter.

Fourth, as we stated in the Initial Letter the proposed amendments to the Company's Articles set forth in the Proposal are couched as amendments to two distinct sections of the Company's Articles. These two amendments contain amendments to multiple distinct sections of the Articles and also the Company's Bylaws. As described in the Initial Letter, (i) one amendment reduces the number of directors, (ii) a second amendment provides for majority voting for director elections, (iii) a third amendment provides for election of directors at annual and special meetings, (iv) a fourth amendment provides for the board to be declassified, (v) a fifth amendment provides that only a majority of the shareholders can amend the Company's Bylaws, (vi) a sixth amendment removes the advance notice requirements for shareholder proposals, (vii) a seventh amendment removes the advance notice requirements for director nominations, (viii) an eighth amendment deletes the provision that the Chairman will preside over shareholders meetings and contingencies if he cannot preside over such meetings, and (ix) a ninth amendment addresses the filling of director vacancies. We fail to see how all of these amendments are part of a "single, well-defined unifying concept" which will undo the actions the Board of Directors allegedly took to obtain excessive control over the Company and its resources. For instance, how would reducing the number of directors reduce the power of the Board of Directors or undo any recent action? The power of the Board of Directors is provided by Section 351.310 of the MGBCL (discussed above) regardless of the number of directors. Furthermore, how would a majority voting requirement for the election of directors undo recent actions and reduce the power of the Board of Directors? Once again, it would have no effect; it would simply raise the bar for being elected to the Board of Directors. We are also curious as to how deleting the provision of the Company's Bylaws that provides for the President to act as Chairman at Board of Directors' meetings in the Chairman's absence will undo any recent action and reduce the power of the Board of Directors. Once again, this amendment would have no effect on the power of the Board of Directors under Missouri law and it would not undo any recent actions. It is abundantly clear that these multiple proposals are not linked by "one single, well-defined unifying concept." Simply put, the Proponent submitted multiple "items" in the July 5th Letter, bundled the multiple "items" (including new proposals) into the Proposal and through the broadly defined "purpose" (which is inconsistent with the supporting statement) in the Response Letter is trying to couch these multiple proposals as being part of "one single, well-defined unifying concept."

With respect to the no action letter precedent on this point identified in the Initial Letter, the Proponent states that the case at hand is distinguishable from those no action letters; however, the Response Letter was void of any support for that assertion with respect to the multiple proposal issue. As the Commission will note, the no action letter precedent cited in the Initial Letter is on point.

As set forth in the Initial Letter, the Proposal contains multiple proposals which are not linked by "one single, well-defined unifying concept" and thus, the Proposal may be excluded. The analysis contained in the Initial Letter and the no action letter precedent cited therein are determinative on this issue. The Proponent asserts several no action letters in support of their contention that the Proposal contains multiple proposals that are part of "one single, well-defined unifying concept"; however, none of these no action letters are applicable to the case at hand. We acknowledge that the SEC has long recognized proposals tailored to address executive compensation (Ferrofluidics Corp. (September 18, 1992)) and director independence (Quality Systems, Inc. (June 9, 1999)) issues each as being a "single, well-defined unifying concept". However, we are unaware of any no action letters recognizing any single, unifying concept similar to the "purpose" stated in the Response Letter, let alone the other purposes set forth in the Proposal's supporting statement (see discussion above). The Proposal does not touch upon any of the "single concepts" the SEC has previously recognized. We further note that the proposals at issue in AT&T (April 10, 2002) were narrowly tailored to provide that, if AT&T formed a new corporation, shareholders could vote on certain distinct governance issues with respect to that new corporation. Clearly, neither the "purpose", the supporting statement nor the Proposal are narrowly tailored. The Proponent has misapplied the cited no action letter precedent.

IV. Conclusion.

We did not feel it necessary to provide a detailed analysis regarding the Proposal's violation of the "anti-bundling" rules because the precedent cited by the Proponent is misapplied for similar reasons as described in the last paragraph of Section III above, Our analysis of this issue in the Initial Letter and the precedent cited therein is determinative on this issue. Furthermore, we also felt it unnecessary to add to our argument that the supporting statement contained false and misleading statements that were clearly not offered up as opinion.

Based on the analysis contained in the Initial Letter and this letter, the Company hereby renews its request that the Staff not recommend any enforcement action if the Proposal is excluded from the Company's 2006 Proxy Materials.

We are concurrently providing copies of this correspondence to the Proponent. In the interest of a fair and balanced process, we request that the Staff notify the undersigned if it receives any correspondence on the Proposal or this letter from the Proponent or other persons, unless that correspondence has specifically confirmed to the Staff that the Company or its counsel have timely been provided with a copy of the correspondence. If we can provide additional correspondence to address any questions that the Staff may have, please do not hesitate to call me at the number listed on the first page of this letter.

Sincerely,

STINSON MORRISON HECKER LLP

/s/

Victoria R. Westerhaus

cc: H. James Serrone
Basil P. Caloyeras
Robert C. Levy, Esq.

-----FOOTNOTES-----

¹ See for example, Fletcher Cyclopedia Corporations, §2013.10 (Volume 5) (noting that where a quorum is once present to organize a shareholders meeting, it is generally not broken by subsequent withdrawal of a part of the shareholders. The purpose of this is to prevent a shareholder from defeating a quorum by simply walking out of a meeting.)

² 493 S.W.2d 58, 61-62 (1973)(citing Commonwealth ex rel. Sheip v. Vandergrift, 81 A. 153 (May 23, 1911)). We have attached a copy hereto as Exhibit B.

[STAFF REPLY LETTER]

November 1, 2006

Response of the Office of Chief Counsel Division of Corporation Finance

Re: Torotel, Inc. Incoming letter dated August 2, 2006

The proposal calls for the articles of incorporation to be amended to reduce the number of directors from seven to five, to declassify the board of directors, to permit only shareholders to make, alter, amend, suspend or repeal the by-laws, to revoke certain provisions of the by-laws relating to the ability of directors to fill vacancies on the board of directors and to establish an executive committee of directors, to revoke certain provisions of the by-laws to remove advance notice requirements for shareholders to bring business before a shareholder meeting or to nominate directors, to revoke the provision of the by-laws relating to the presiding officials at shareholder meetings, and to permit shareholders holding not less than fifteen percent of outstanding shares to call special meetings of shareholders.

There appears to be some basis for your view that Torotel may exclude the proposal under rule 14a-8(c). Accordingly, we will not recommend enforcement action to the Commission if Torotel omits the proposal from its proxy materials in reliance on rule 14a-8(c). In reaching this position, we have not found it necessary to address the alternative bases for omission upon which Torotel relies.

We note that Torotel did not file its statement of objections to including the submission in its proxy materials at least 80 days before the date on which it will file definitive proxy materials as required by rule 14a-8(j)(1). Noting the circumstances of the delay, we grant Torotel's request that the 80-day requirement be waived.

Sincerely,

/s/

Mary Beth Breslin
Special Counsel

Top

// This display the document title in the html page document.write(document.title);

Company Name: Torotel, Inc. Public Availability Date: November 1, 2006

Document Sections:

Company Name: Torotel, Inc.
Public Availability Date: November 1, 2006