EX-(E)(1)FORM OF EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT


THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is entered into by and between
Maurice P. Andrien, Jr. ("YOU") and SunSource, Inc., a Delaware corporation (the
"COMPANY") and will be effective as of the "EFFECTIVE DATE" as stated in Section
13(c) of this Agreement.

WHEREAS, you will be employed as the Chairman of the Board of the
Company; and

WHEREAS, the Company has hired you and is willing to continue your
employment based on your particular qualifications, on the condition that you
shall enter into this Agreement and shall fully perform all the responsibilities
and duties and strictly observe all of your obligations hereunder;

NOW, THEREFORE, in consideration of your employment by the Company and
the compensation to be paid by the Company to you in connection therewith and
for other good and valuable consideration, you and the Company hereby agree as
follows:

1. Position and Responsibilities.


(a) Position. The Company agrees to employ you as the Chairman of
the Board throughout the Term (defined below). You shall report to the Board of
Directors. Your duties shall include providing strategic direction for the
Company, including mergers and acquisitions, maximizing Allied Capital
Corporation's return on its investment and performing other duties as may from
time to time be assigned by the Board.

(b) Responsibilities. You shall devote three days per week to the
Company and perform the responsibilities assigned to you in accordance with the
standards and policies that the Company may from time to time establish. The
Company shall not preclude you from engaging in appropriate civic, charitable or
religious activities or from devoting a reasonable amount of time to private
investments or board or other activities that do not interfere or conflict with
your responsibilities and are not injurious to the Company. You and the Company
agree that your position is essential to the Company's success and that the
highest level of performance is required from you.

2. Term of Employment.

(a) Basic Rule. The Company agrees to employ you, and you agree to
remain in employment with the Company, from the Effective Date until the fourth
anniversary of such date (the "TERM"), unless your employment terminates earlier
pursuant to Section 5 below.

(b) Renewal of Term. On the fourth (4th) anniversary and on each
subsequent anniversary of the Effective Date, the Term shall be renewable for
additional one-year periods upon the mutual written agreement of both parties.






3. Compensation.


(a) Base Compensation. You will be entitled to receive base
compensation during the Term ("BASE COMPENSATION"). Your Base Compensation for
the first year of the Term shall be at the annual rate of $343,000 per year and
your annual Base Compensation for the remainder of the Term shall not be less
than that amount. Base Compensation shall be paid in equal biweekly
installments, less deductions required by law. The Board will review and may
adjust your Base Compensation periodically, usually annually on or about
February 1st. Such review shall be in accordance with performance criteria to be
determined by the Company in its sole discretion.

(b) Bonus Compensation. You shall receive bonus compensation for
2001 in accordance with the performance targets established in January, 2001 by
the Company for 2001, payable during the first quarter of 2002. During the
remainder of the the Term, usually on an annual basis, you shall be eligible to
receive an additional cash payment of up to 100% of Base Compensation (less
deductions required by law) ("BONUS Compensation"), which shall be determined
with reference to your performance in accordance with performance criteria to be
determined by the Board in its sole discretion for each calendar year.

(c) Stock Options and Deferred Compensation. During the Term, you
will be eligible to participate in the Company's Stock Option Plan and Deferred
Compensation Plan.

(d) Business Expenses. During the Term, the Company shall pay or
reimburse you for all ordinary and reasonable business-related expenses you
incur in the performance of your duties under this Agreement. The Company will
reimburse you for all such expenses upon the presentation by you of an itemized
account of such expenditures, together with supporting receipts and other
appropriate documentation.

4. Employee Benefits.

(a) In General. During the Term, you shall be eligible to
participate in the employee benefit plans and executive compensation and
perquisite programs that the Company may provide, including but not limited to
health, and insurance plans and 401k, subject in each case to the generally
applicable terms and conditions of the plan or program in question and to the
determinations of any person or committee administering such plan or program.
The Company reserves the right to modify or terminate these plans at any time.
The Company will provide you during the Term with benefits and perquisites that
are reasonably comparable to those in effect immediately prior to the Effective
Date.

(b) Paid Holidays. You shall be entitled to take ten (10) paid
holidays per year as specified by Company policy from time to time for all of
the Company's employees.

(c) Vacation. You shall be entitled to take four (4) weeks of
vacation per year.


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5. Termination of Employment. Upon the effective date of termination of
your employment with the Company (the "TERMINATION DATE"), you will not be
eligible for further compensation, benefits or perquisites under Sections 3 and
4 of this Agreement, other than those that have already accrued and, with regard
to Bonus Compensation, a pro rata share of your Bonus Compensation for that
year. Termination of your employment may occur under any of the following
circumstances:

(a) Company's Termination of Employment. The Company has the right
to terminate your employment at any time, with or without Cause. For all
purposes under this Agreement, "CAUSE" shall mean:

(i) A willful failure to substantially perform your duties
under this Agreement, other than failure resulting from
complete or partial incapacity due to physical or mental
illness or impairment;

(ii) A willful act which constitutes gross misconduct or
fraud and which is injurious to the Company;

(iii) Conviction of, or plea of "guilty" or "no contest" to a
felony; or

(iv) A material breach of any duty owed to the Company,
including the duty of loyalty and the confidentiality
agreement.

No act, or failure to act, by you shall be considered "willful" unless committed
without good faith and without a reasonable belief that the act or omission was
lawful and in the Company's best interest.

(b) Your Resignation from Employment. You have the right to resign
your employment with the Company at any time, with or without Cause or Good
Reason. You agree to provide the Company thirty (30) days prior written notice
of resignation. The Company may in its sole discretion place you on
administrative leave as of any date prior to the end of such thirty (30) day
notice period and request that you no longer be present on Company premises.
During any period of paid administrative leave, you will not be authorized to
act as a representative, or make any statements on behalf of, the Company.

(c) Death or Disability.

(i) Your employment shall be deemed to have been terminated
by you upon your (A) death or (B) inability to perform
your duties under this Agreement, even with reasonable
accommodation, for more than twenty-six (26) weeks,
whether or not consecutive, in any twelve-month period
("DISABILITY"). Termination will be effective upon the
occurrence of such event.

(ii) If your employment ends as a result of death or
Disability, you or your estate will receive:



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(A) A payment for your accrued base salary and
vacation and pro rata share of your bonus for
that year; and

(B) In accordance with the Stock Option Plan, your
vested stock options and the acceleration of
vesting of any options that would have vested
during the one-year period after the date of
death or disability.

6. Defined Conditions:

(a) Change in Control. Change in Control shall mean the occurrence
of any of the following events after the Effective Date of this Agreement:

(i) the sale of substantially all of the assets of the
Company;

(ii) the acquisition by any person or group of persons acting
in concert (other than the Company or an affiliate or an
employee pension benefit plan of the Company or a trust
established under such plan) of securities of the
Company representing 50% or more of the aggregate voting
power of the Company's then-outstanding common stock; or

(iii) a merger or acquisition of the Company in which the
voting equity securities of the Company (together with
all options to acquire such securities whether vested or
unvested) beneficially owned by Allied Capital
Corporation and the Minority Holders (as defined in the
Stockholders Agreement with respect to the Company) is
reduced below 51%.

Notwithstanding the foregoing, a transaction involving an acquisition or sale of
the Company or its assets solely between or among its affiliates would not
constitute a Change In Control.

(b) Good Reason. For purposes of this Agreement, Good Reason shall
mean that the Company:

(i) has adversely changed your position from the position
specified in Section 1 of this Agreement;

(ii) has materially changed your duties or authority such
that they are no longer consistent with the duties
specified in Section 1 of the Agreement;

(iii) has reassigned you to a work location that is more than
75 miles from your present work location;

(iv) has materially breached this Agreement, or has removed
you from the Board for any reason other than for Cause,
while you remain an employee of the Company.



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7. Severance Payments.

(a) Termination Without Cause or Resignation for Good Reason.

(1) Amount of Severance Compensation. If during the Term the
Company terminates your employment without Cause, except as provided for
in Section 7(b), or you resign with Good Reason, the Company will pay
you two times your annual Base and Bonus Compensation and benefits as
provided below ("Severance Compensation"). To receive such payments you
must within forty-five (45) days of your Termination Date sign a release
of any and all claims in the form provided by the Company. Such payments
shall begin at the later of (a) the first pay period following your
Termination Date or (b) ten (10) days after you deliver the signed
release to the Company.

(2) Payment of Severance Compensation. The Company shall pay
the Severance Compensation as follows:

(A) continue to pay on a biweekly basis your Base
Compensation in accordance with the rate in
effect on the Termination Date;

(B) pay you Bonus Compensation on the same annual
schedule as if you continued to be employed and
payments of such Bonus Compensation shall be
calculated based on a pro rata basis using the
rate for a full calendar year that is equal to
the greater of either:

i) the average of your annual bonuses for
the preceding three years or,

ii) the amount of the last annual bonus you
received prior to the Termination Date.

(C) pay your monthly COBRA payments for any period
of time that you have applied and qualify for
COBRA coverage, and continue your life insurance
and disability insurance coverage to the extent
permitted under the applicable benefit plans.

The combined total of the payments under Sections 7(a)(1) A and B will not be
less than One Million Dollars ($1,000,000.00).

This Severance Compensation shall be subject to usual and required withholding.
In the event that your death occurs prior to the completion of payment of
Severance Compensation, the remainder of your Severance Compensation will be
paid in a single lump sum to your estate.

(b) Termination After Change in Control Or After the Term. If 1)
during the Term the Company terminates your employment without cause after a
Change In Control that occurs


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on or after the third anniversary of the Effective Date or 2) after the Term
expires the Company terminates your employment without Cause or you resign your
employment for Good Reason, or because of a reduction in your Base Compensation,
you will not be eligible for Severance Compensation under Section 7(a), but,
provided that you sign a release of any and all claims in the form provided by
the Company within forty-five (45) days your Termination Date, you shall be
entitled to:

(1) Compensation. A lump sum paid within 30 days after your
Termination Date that is equal to the total of:

(A) an amount equal to your Base Compensation for
one (1) year which shall not be less than the
greater of 1) the rate in effect on the
Termination Date or 2) the rate in effect at the
end of the Term, less deductions required by
law; and

(B) an amount equal to the greater of either:

1) the annual average of your last three
annual bonuses prior to the Termination
Date, or

2) the amount of the last annual bonus you
received prior to the Termination Date.

(2) COBRA Payments. The Company will pay your monthly COBRA
payments for any period of time that you have applied
and qualify for COBRA coverage and continue your life
insurance and disability income insurance to the extent
permitted under the applicable plans.

(c) No Mitigation. You shall not be required to mitigate the amount
of any payment contemplated by this Section 7, nor shall any such payment be
reduced by any earnings that you may receive from any other source.

8. Other Obligations.

You warrant that you are not subject to any other obligations that would
conflict with or inhibit your ability to perform your duties under this
Agreement. You further warrant that you have not and will not bring to the
Company or use in the performance of your responsibilities at the Company any
equipment, supplies, facility or trade secret information (that is not generally
available to the public) of any current or former employer or organization other
than the Company to which you provided services, unless you have obtained
written authorization for their possession and use.

9. Confidential Information.

You shall not disclose or use at any time, either during or after the
Termination Date, any confidential information ("CONFIDENTIAL INFORMATION")
(defined below) of the Company,



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whether patentable or not, which you learn as a result of your employment with
the Company, whether or not you developed such information. Confidential
Information shall include, without limitation, information regarding the
Company's, it customers' or its business partners' trade secrets and:

- any information about existing and prospective investments;

- financing information and sources;

- patent applications, developmental or experimental work,
formulas, test data, prototypes, models, and product
specifications;

- financial information;

- financial projections and pro forma financial information;

- sales and marketing strategies, plans and programs and product
development information;

- employees' and consultants' benefits, perquisites, salaries,
stock options, compensation, formulas or bonuses, and their
non-business addresses and telephone numbers;

- organizational structure and reporting relationships; and

- business plans.

Information that is or later becomes publicly available in a manner wholly
unrelated to any breach of this Agreement by you will not be considered
Confidential Information as of the date it enters the public domain. If you are
uncertain whether something is Confidential Information you should treat it as
Confidential Information until you receive clarification from the Company that
it is not Confidential Information. Confidential Information shall remain at all
times the property of the Company. You may use or disclose Confidential
Information only:

(a) as authorized and necessary in performing your responsibilities
under this Agreement during your employment with the Company; or

(b) with the Board's prior written consent; or

(c) in a legal proceeding between you and the Company to establish
the rights of either party under this Agreement, provided that you stipulate to
a protective order to prevent any unnecessary use or disclosure;

(d) with respect to employees whose home addresses or telephone
numbers are personally known to you, you may disclose on an occasional and
infrequent basis such information about a single employee to a person who is
known to and has a pre-existing relationship with such



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employee; you agree that you will indemnify the Company for the defense of and
any liability resulting from any objection or claim based on such disclosure by
such employee against you or the Company; or

(e) subject to a compulsory legal process that requires disclosure
of such information, provided that you have complied with the following
procedures to ensure that the Company has an adequate opportunity to protect its
legal interests in preventing disclosure.

Upon receipt of a subpoena that could possibly require disclosure of
Confidential Information, you shall provide a copy of the compulsory process and
complete information regarding the circumstances under which you received it to
the Company by hand delivery within a reasonable period of time, and generally
within twenty-four (24) hours. You will not make any disclosure until the latest
possible date for making such disclosure in accordance with the compulsory
process ("LATEST POSSIBLE DATE"). If the Company seeks to prevent disclosure in
accordance with the applicable legal procedures, and provides you with notice
before the Latest Possible Date that it has initiated such procedures, you will
not make disclosures of any Confidential Information that is the subject of such
procedures, until such objections are withdrawn or ruled on.

You hereby acknowledge that any breach of this Section 9 would cause the
Company irreparable harm.

10. Non-Solicitation.

For two (2) years from the Termination Date, you will not, directly or
indirectly, individually or as part of or on behalf of any other person,
company, employer or other entity, hire or attempt to solicit for hire, any
persons who are employed by the Company in any capacity as a part of the sales
force or selling organization/division(s) of the Company, or employed in any
capacity in the Company in which their compensation exceeds $60,000 per year
(indexed by an inflationary factor tied to the consumer price index annually)
within six months of the Termination Date until at least six (6) months after
the person's employment with the Company ends ("COVERED EMPLOYEE"). If any
Covered Employee accepts employment with any person, company, employer or other
entity of which you are an officer, director, employee, partner, shareholder
(other than of less than 5% of the stock or equity of a publicly traded company)
or joint venture, it will be presumed that the Covered Employee was hired in
violation of this provision ("PRESUMPTION"). This Presumption may only be
overcome by your showing by a preponderance of the evidence that you were not
directly or indirectly involved in soliciting or encouraging the Covered
Employee to leave employment with the Company. You agree to notify any person or
entity to which you provide services within one year of the Termination Date of
the terms of your obligations under this Section 10. The parties agree that any
breach of this Section 10 will entitle the Company to injunctive relief
enforcing this Section 10 and to damages equal to the greater of the actual
damages proven or liquidated damages of three times the amount of the annual
total compensation of any person solicited or hired in breach of this Section
10. The parties are agreeing to liquidated damages as an option to actual
damages in recognition that the Company's employees are its most valuable asset,
but it is often difficult to prove the actual damages resulting from such a
breach.


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11. Indemnification.

During the Term and at all times thereafter, you shall be indemnified by
the Company to the fullest extent permitted by the laws of the State of Delaware
from any claims or actions based upon any acts or omissions, or alleged acts or
omissions, by you which arise out of or are related to your employment with the
Company. You shall be a beneficiary of any directors' and officers' liability
insurance policy maintained by the Company as long as you remain an officer or
director.

12. Return of Property.

Upon termination of your employment with the Company for any reason, you
agree to immediately return to the Company all property belonging to the
Company. This includes all documents and other information prepared by you or on
your behalf or provided to you in connection with your duties under this
Agreement, regardless of the form in which such documents or information are
maintained or stored, including computer, typed, written, imaged, audio, video,
micro-fiche, electronic or any other means of recording or storing documents or
other information. You hereby warrant that you will not retain in any form any
such document or other information or copies thereof, except as provided in the
following sentence. You may retain a copy of this Agreement and information
describing any rights you may have after the Termination Date under any employee
benefit plan or other agreements.

13. Miscellaneous Provisions.

(a) Notices. Unless otherwise provided herein, any notice or other
information to be provided to the Company will be sent by overnight delivery
with acknowledgement of receipt requested, to:

Chairman, Board of Directors
SunSource, Inc.
One Logan Square
Philadelphia, PA
cc: Sally D. Garr, Esq.
Patton Boggs, LLP
2550 M Street, N.W.
Washington, D.C. 20037

Any notice or other information to be provided to you will be sent by overnight
delivery with acknowledgement of receipt requested, to:

Maurice P. Andrien, Jr.
36 Harrison Drive
Newton Square, PA 19073



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(b) Dispute Resolution. You and the Company agree that any dispute
between you and the Company will be finally resolved by binding arbitration in
accordance with the Federal Arbitration Act ("FAA"). You and the Company agree
to follow the Dispute Resolution Procedures set forth in Attachment A to this
Agreement.

(c) Nature of Agreement. This Agreement and the attachments hereto
constitute the entire agreement between you and the Company and supercede all
prior agreements and understandings and any rights or obligations thereto
between you and the Company with respect to the subject matter hereof. In making
this Agreement, the parties warrant that they did not rely on any
representations or statements other than those contained in this Agreement. No
provision of this Agreement shall be modified, waived or discharged unless the
modification, waiver or discharge is agreed to in writing and signed by you and
by the Chairman of the Board for Allied Capital Corporation. No waiver by either
party of any breach of, or of compliance with, any condition or provision of
this Agreement by the other party shall be considered a waiver of any other
condition or provision or of the same condition or provision at another time.
Regardless of the choice of law provisions of Delaware or any other
jurisdiction, the parties agree that this Agreement shall be otherwise
interpreted, enforced and governed by the laws of the State of Delaware. This
Agreement shall be binding on the Company's successors and assigns and on you,
your heirs and personal representatives. This Agreement will continue in effect
until all obligations under it are fulfilled. You may not assign this Agreement,
either voluntarily or involuntarily. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect and this Agreement shall be interpreted as if the unenforceable
provision had not been included in it. This Agreement may be executed in any
number of counterparts each of which shall be an original, but all of which
together shall constitute one instrument. This Agreement will be effective as of
the Effective Time stated in Section 1.3 of The Agreement and Plan of Merger
dated 18 June 01 between Allied Capital Corporation, Allied Capital Lock
Acquisition Corporation and SunSource, Inc. ("EFFECTIVE DATE"). The headings in
this Agreement are for convenience only and shall not effect the interpretation
of this Agreement. You further certify that you fully understand the terms of
this Agreement and have entered into it knowingly and voluntarily.

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its authorized officer, as of the day and year set
forth under their signatures below.

SUNSOURCE, INC.


/s/ MAURICE P. ANDRIEN, JR. By:
- ---------------------------- ------------------------
EMPLOYEE

Date: 18 JUNE 01 Date:
----------------------- ----------------------


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ATTACHMENT A



DISPUTE RESOLUTION PROCEDURES



The parties agree to make a good faith effort to informally resolve any dispute
before submitting the dispute to arbitration in accordance with the following
procedures:

(i) The party claiming to be aggrieved shall furnish to the
other a written statement of the grievance, all persons
whose testimony would support the grievance, and the
relief requested or proposed. The written statements
must be delivered to the other party within the time
limits for bringing an administrative or court action
based on that claim.

(ii) If the other party does not agree to furnish the relief
requested or proposed, or otherwise does not satisfy the
demand of the party claiming to be aggrieved within 30
days and the aggrieved party wishes to pursue the issue,
the aggrieved party shall by written notice demand that
the dispute be submitted to non-binding mediation before
a mediator jointly selected by the parties.

(iii) If mediation does not produce a resolution of the
dispute and either party wishes to pursue the issue,
that party shall request arbitration of the dispute by
giving written notice to the other party within 30 days
after mediation. The parties will attempt to agree on a
mutually acceptable arbitrator and, if no agreement is
reached, the parties will request a list of nine
arbitrators from the American Arbitration Association
and select by alternately striking names. Regardless of
whether the American Arbitration Association administers
the arbitration, the arbitration will be conducted
consistent with the American Arbitration Association's
National Rules for Resolution of Employment Disputes
("RULES") that are in effect at the time of the
arbitration. If there is any conflict between those
Rules and the terms of the Employment Agreement
("AGREEMENT"), including all attachments thereto, the
Agreement will govern. The arbitrator shall have
authority to decide whether the conduct complained of
under Subsection (a) above violates the legal rights of
the parties. In any such arbitration proceeding, any
hearing must be transcribed by a certified court
reporter and any decision must be supported by written
findings of fact and conclusions of law. The
arbitrator's findings of fact must be supported by
substantial evidence on the record as a whole and the
conclusions of law and any remedy must be provided for
by and consistent with the laws of the Delaware and
federal law. The arbitrator






shall have no authority to add to, modify, change or
disregard any lawful term of the Agreement. The Company
will pay the arbitrator's fee.

(iv) Arbitration shall be the exclusive means for final
resolution of any dispute between the parties, except
that injunctive relief may be sought from any court of
competent jurisdiction located in the Delaware when
injunctive relief is necessary to preserve the status
quo or to prevent irreparable injury, including, without
limitation, any claims concerning an alleged breach of
Sections 9, 10, or 12 of the Agreement or other misuse
of Confidential Information.




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